Latest news with #JonathanGoulding
NDTV
16 hours ago
- Business
- NDTV
Canned-Food Producer Del Monte Foods Files for Bankruptcy
Canned fruit company Del Monte Foods filed for bankruptcy, less than a year after executing a controversial debt restructuring. The company entered into a lender-backed restructuring support agreement that calls for the food producer to sell its assets in bankruptcy court. Del Monte has lined up financing to fund its Chapter 11 case, giving the firm $165 million in fresh cash in exchange for added protection for hundreds of millions of dollars in existing debt. A judge approved the loan in a court hearing late Wednesday afternoon. The company sought court protection in New Jersey, saying it is carrying roughly $1.245 billion in secured debt. Del Monte blamed its Chapter 11 filing on multiple factors, including a costly buildup of excess inventory resulting from elevated demand during the Covid-19 pandemic and significant debt that's become more expensive as a result of rising interest rates. The bankruptcy filing is the latest turn in a challenging year for the borrower that saw its parent company Del Monte Pacific Ltd. in June elect to skip a payment to the unit's lenders as part of a lawsuit settlement tied to its restructuring last year. Del Monte in a Tuesday court filing said it has carried substantial debt since it was acquired by DMPL from a group of funds led by KKR. The acquisition by DMPL, which is publicly listed on the Singapore Stock Exchange, was funded by debt that was put on Del Monte's balance sheet, the company's Chief Restructuring Officer Jonathan Goulding said in the court filing. The firm's cash interest expense increased from $66 million in 2020 to $125 million in the 2025 fiscal year, Goulding said. The interest expense "materially exceeds" Del Monte's current projected earnings before interest, taxes, depreciation and amortization and constrained its liquidity, he said. Del Monte Foods in its statement said the restructuring support agreement contemplates the company undertaking a going-concern sale process for all or substantially all of its assets. Financing along with cash from ongoing operations is expected to provide sufficient liquidity during the sale process and fund ongoing operations, as it intends to keep serving customers, according to the statement. The company executed a debt overhaul last year, which became the subject of a lawsuit by left-behind lenders, who said Del Monte Foods defaulted on a $725 million financing agreement when it shifted the assets away from the reach of lenders. The strategy - known in industry parlance as a drop-down transaction - allowed Del Monte Foods to raise fresh liquidity by borrowing against the transferred assets. The deal also prioritized participating lenders via debt swaps and created different payment priorities, Bloomberg reported.
Malaysian Reserve
2 days ago
- Business
- Malaysian Reserve
Canned-food producer Del Monte Foods files for bankruptcy
CANNED fruit company Del Monte Foods filed for bankruptcy, less than a year after executing a controversial debt restructuring. The company entered into a lender-backed restructuring support agreement that calls for the food producer to sell its assets in bankruptcy court. Del Monte has lined up financing to fund its Chapter 11 case, giving the firm $165 million in fresh cash in exchange for added protection for hundreds of millions of dollars in existing debt. The company sought court protection in New Jersey, saying its carrying roughly $1.245 billion in secured debt. Del Monte blamed its Chapter 11 filing on multiple factors, including a costly buildup of excess inventory resulting from elevated demand during the Covid-19 pandemic and significant debt that's become more expensive as a result of rising interest rates. The bankruptcy filing is the latest turn in a challenging year for the borrower that saw its parent company Del Monte Pacific Ltd. in June elect to skip a payment to the unit's lenders as part of a lawsuit settlement tied to its restructuring last year. Del Monte in a Tuesday court filing said it has carried substantial debt since it was acquired by DMPL from a group of funds led by KKR. The acquisition by DMPL, which is publicly listed on the Singapore Stock Exchange, was funded by debt that was put on Del Monte's balance sheet, the company's Chief Restructuring Officer Jonathan Goulding said in the court filing. The firm's cash interest expense increased from $66 million in 2020 to $125 million in the 2025 fiscal year, Goulding said. The interest expense 'materially exceeds' Del Monte's current projected earnings before interest, taxes, depreciation and amortization and constrained its liquidity, he said. Del Monte Foods in its statement said the restructuring support agreement contemplates the company undertaking a going-concern sale process for all or substantially all of its assets. Financing along with cash from ongoing operations is expected to provide sufficient liquidity during the sale process and fund ongoing operations, as it intends to keep serving customers, according to the statement. The company executed a debt overhaul last year, which became the subject of a lawsuit by left-behind lenders, who said Del Monte Foods defaulted on a $725 million financing agreement when it shifted the assets away from the reach of lenders. The strategy — known in industry parlance as a drop-down transaction — allowed Del Monte Foods to raise fresh liquidity by borrowing against the transferred assets. The deal also prioritized participating lenders via debt swaps and created different payment priorities, Bloomberg reported. –BLOOMBERG
Axios
2 days ago
- Business
- Axios
Del Monte Foods files for bankruptcy, plans to pursue sale
Del Monte Foods has filed for Chapter 11 bankruptcy protection and announced it is pursuing a sale. Why it matters: The nearly 140-year-old company — known for staples like canned vegetables and fruit cups — has faced mounting pressures from changing consumer habits, supply chain volatility and rising costs. The company said it has secured support from key creditors for a plan to sell its key assets and stay in business. Zoom in: Del Monte has been suffering from excessive debt, a downturn in consumer demand, increased discounting, a declining private label business and higher costs from inflation, according to a court filing. The company, like other consumer packaged goods brands, has "experienced changing consumer purchase behavior and increased inflationary costs," chief restructuring officer Jonathan Goulding said in a court filing. Context: Founded in 1886 in California, Del Monte eventually became one of the nation's leading packaged fruit sellers. Today, Del Monte has about 2,780 employees and four factories, with two in the U.S. and two in Mexico. The company's brands include its namesake lineup of canned fruit as well as Contadina, College Inn and Joyba. It also sells under private labels, but that business has been shrinking. The company, which is not affiliated with Fresh Del Monte Produce, said in a statement that non-U.S. subsidiaries are not included in the Chapter 11 proceedings. Threat level: The company racked up extra debt in 2023 as it anticipated higher volume — but sales instead fell in the next fiscal year, leaving it with "outsized production commitments," greater costs and higher promotional spending, according to Goulding. The company said it recently closed certain production facilities to reduce its cost structure. But its annual interest expenses exceed projected earnings, leaving it with "historically low liquidity," Goulding said.
Los Angeles Times
2 days ago
- Business
- Los Angeles Times
Canned-food producer Del Monte Foods files for bankruptcy
California canned fruit company Del Monte Foods filed for bankruptcy, less than a year after executing a controversial debt restructuring. The Walnut Creek Calif., company entered into a lender-backed restructuring support agreement that calls for the food producer to sell its assets in bankruptcy court. Del Monte has lined up financing to fund its Chapter 11 case, giving the firm $165 million in fresh cash in exchange for added protection for hundreds of millions of dollars in existing debt. The company sought court protection in New Jersey, saying its carrying roughly $1.245 billion in secured debt. Del Monte blamed its Chapter 11 filing on multiple factors, including a costly buildup of excess inventory resulting from elevated demand during the Covid-19 pandemic and significant debt that's become more expensive as a result of rising interest rates. The bankruptcy filing is the latest turn in a challenging year for the borrower that saw its parent company Del Monte Pacific Ltd. in June elect to skip a payment to the unit's lenders as part of a lawsuit settlement tied to its restructuring last year. Del Monte in a Tuesday court filing said it has carried substantial debt since it was acquired by DMPL from a group of funds led by KKR. The acquisition by DMPL, which is publicly listed on the Singapore Stock Exchange, was funded by debt that was put on Del Monte's balance sheet, the company's Chief Restructuring Officer Jonathan Goulding said in the court filing. The firm's cash interest expense increased from $66 million in 2020 to $125 million in the 2025 fiscal year, Goulding said. The interest expense 'materially exceeds' Del Monte's current projected earnings before interest, taxes, depreciation and amortization and constrained its liquidity, he said. Del Monte Foods in its statement said the restructuring support agreement contemplates the company undertaking a going-concern sale process for all or substantially all of its assets. Financing along with cash from ongoing operations is expected to provide sufficient liquidity during the sale process and fund ongoing operations, as it intends to keep serving customers, according to the statement. The company executed a debt overhaul last year, which became the subject of a lawsuit by left-behind lenders, who said Del Monte Foods defaulted on a $725 million financing agreement when it shifted the assets away from the reach of lenders. The strategy — known in industry parlance as a drop-down transaction — allowed Del Monte Foods to raise fresh liquidity by borrowing against the transferred assets. The deal also prioritized participating lenders via debt swaps and created different payment priorities, Bloomberg reported. Basu , Phakdeetham and Randles write for Bloomberg.
