Pilgrim's retains its pride in recovery
Source: Agencies |
December 30, 2009, Wednesday
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Print Edition
Print Edition
CHICKEN producer Pilgrim's Pride Corp said on Monday that it has emerged from bankruptcy protection and will soon be part of the world's largest meat producer.
The Pittsburgh company filed for bankruptcy protection more than a year ago after it was unable to cope with mounting debt, low chicken prices and rising feed costs.
Pilgrim's Pride continued to operate while under bankruptcy protection but underwent major changes, shutting plants, cutting thousands of jobs and shedding production to improve its financial position.
The United States Bankruptcy Court in the Northern District of Texas approved a reorganization plan for the company earlier this month.
Under the plan, the company is selling a 64 percent stake, worth US$800 million, to Brazilian beef giant JBS.
JBS is also on track to buy Bertin SA, one of Latin America's largest producers and exporters of milk products, beef and leather. The two deals combined would bump Tyson Foods from the top slot in the industry.
The influx of cash to Pilgrim's Pride from the JBS deal and savings found during restructuring let the company repay its creditors in full, an unusual outcome in a corporate bankruptcy, as creditors aren't often repaid.
Even stockholders, generally left out in the cold in a bankruptcy, are getting something. Pilgrim's Pride is redistributing shares not being sold to JBS to current stockholders.
Pilgrim's Pride president and CEO said in a statement on Monday that the company is beginning a new chapter as a stronger organization.
The deal could also heighten competition in a consolidating meat industry, which has been weathering a downturn brought on by volatile feed costs, oversupply and a slump in demand.
The Pittsburgh company filed for bankruptcy protection more than a year ago after it was unable to cope with mounting debt, low chicken prices and rising feed costs.
Pilgrim's Pride continued to operate while under bankruptcy protection but underwent major changes, shutting plants, cutting thousands of jobs and shedding production to improve its financial position.
The United States Bankruptcy Court in the Northern District of Texas approved a reorganization plan for the company earlier this month.
Under the plan, the company is selling a 64 percent stake, worth US$800 million, to Brazilian beef giant JBS.
JBS is also on track to buy Bertin SA, one of Latin America's largest producers and exporters of milk products, beef and leather. The two deals combined would bump Tyson Foods from the top slot in the industry.
The influx of cash to Pilgrim's Pride from the JBS deal and savings found during restructuring let the company repay its creditors in full, an unusual outcome in a corporate bankruptcy, as creditors aren't often repaid.
Even stockholders, generally left out in the cold in a bankruptcy, are getting something. Pilgrim's Pride is redistributing shares not being sold to JBS to current stockholders.
Pilgrim's Pride president and CEO said in a statement on Monday that the company is beginning a new chapter as a stronger organization.
The deal could also heighten competition in a consolidating meat industry, which has been weathering a downturn brought on by volatile feed costs, oversupply and a slump in demand.
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