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CINCINNATI -- Pierre Foods Inc., a major foodservice product supplier to the c-store industry, has taken "a significant step forward" in its efforts to emerge from Chapter 11 bankruptcy by filing a consensual reorganization plan with the U.S. Bankruptcy Court. Pierre will ask the court to confirm the reorganization plan in early December, and hopes to emerge from bankruptcy shortly thereafter.
The plan is supported by funds managed by Oaktree Capital Management L.P., the company’s single largest creditor, and Pierre‘s official committee of unsecured creditors. Upon the plan’s confirmation, Oaktree will become the new majority owner of Pierre.
"The filing of this consensual plan represents a significant step forward in our efforts to emerge from Chapter 11 as a stronger company that can operate profitably in this difficult economic environment and beyond," Pierre Foods CEO Norbert Woodhams said in a statement. "We are very pleased to have Oaktree as our new financial sponsor and believe Oaktree’s continuing commitment to Pierre demonstrates its deep belief in the fundamental strengths and the inherent value of our company."
Woodhams noted Pierre has made great progress in its efforts to restructure the company and is poised to conclude restructuring more quickly than originally projected. "We have realigned our capital structure by eliminating over $225 million of debt and our business continues to perform in line with our expectations," he said. "We look forward to concluding this process and emerging from Chapter 11 as expeditiously as possible."
As previously reported by CSNews Online, Cincinnati-based Pierre Foods filed Chapter 11 under the U.S. Bankruptcy Code in July in an effort to restructure its debt.
"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," Woodhams stated at the time of the initial filing. "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."
Pierre is a manufacturer, marketer and distributor of pre-cooked and ready-to-cook protein products, compartmentalized meals and hand-held convenience sandwiches.