Canned-Food Producer Del Monte Foods Files for Bankruptcy

(Bloomberg) – Canned fruit company Del Monte Foods applied for bankruptcy after a year after the execution of a controversial debt restructuring.

The company made a restructuring support agreement with lenders and started the volunteer department 11 procedures to apply the conditions. Some existing lenders have committed a $ 912.5 million debtor financing financing, including 165 million dollars of financing of $ 165 million.

The application to the US bankruptcy court for the New Jersey region says that the company has both obligations and assets estimated between 1 billion to 10 billion dollars.

Development ends a challenging year for the debtor, who sees that the unit has chosen to pay a payment to the lenders as a part of a controversial debt restructuring of the parent company Del Monte Pacific Ltd. in June.

Del Monte Foods said the restructuring support contract thinks that the company’s assets have undertaken a largely or large sales process. According to the statement, it is expected to provide sufficient liquidity and finance ongoing operations during the sales process with the cash obtained from ongoing operations.

Del Monte Foods realized a debt revision last year, which was the subject of a case that said that the company had defailed a $ 725 million financing agreement when the lenders shifted assets in a way that the lenders could not reach.

The strategy, known as an opensing transaction in the industrial glance, allowed Del Monte Foods to borrow against transferred assets and increase the new liquidity. Bloomberg reported that the lenders participating in the agreement give priority through debt swaps and created different payment priorities.

There are more stories like this Bloomberg.com