CINCINNATI — Pierre Foods Inc. has filed for protection under Chapter 11 of the United States Bankruptcy Code, in order to restructure its debt. Operations are expected to continue normally while the company executes its reorganization plan.
The convenience food manufacturer reported in June that it was considering strategic and restructuring alternatives after failing to meet its debt obligation to its senior credit facility. The company said it intends to work with its creditors to reach mutually acceptable resolutions and to exit bankruptcy as expeditiously as possible.
“As a result of rising raw material prices experienced throughout our industry, it is necessary for Pierre Foods to create a capital structure more appropriate for both our operations and the current marketplace,” said Norbert Woodhams, chief executive officer of Pierre Foods. “We have taken and will continue to take steps to strengthen and streamline operations and right-size Pierre’s cost structure in order to avoid placing the burden of our inflated raw materials costs solely on our customers.
“After careful consideration of all available alternatives, the company’s board of directors determined that filing for Chapter 11 was a necessary and prudent step that allows us to operate our business without interruption while continuing to implement a debt restructuring in a controlled, court-supervised environment,” Woodhams explained.
Pierre has taken action to optimize its profitability and right-size its cost structure. Steps include supporting more efficient inventory management by eliminating product duplication and unprofitable lines; implementing new strategies for increasing inventory turns; streamlining its organizational structure; focusing on profitable business ventures; and enhancing customer service.
Founded in 1946, Pierre is a leading manufacturer and distributor of precooked and ready-to-cook protein products, compartmentalized meals and handheld convenience sandwiches.