Pierre Foods files plan of reorganization
September 30, 2008
by Eric Schroeder
CINCINNATI — Pierre Foods Inc., a manufacturer, marketer and distributor of pre-cooked and ready-to-cook protein products, compartmentalized meals, and hand-held convenience sandwiches, has filed a joint plan of reorganization with the U.S. Bankruptcy Court for the District of Delaware.
Under terms of the plan, Pierre said it will be owned by funds managed by Los Angeles-based Oaktree Capital Management L.L.P., which is Pierre’s single largest creditor. Oaktree supplied $35 million in debtor-in-possession financing to Pierre.
Pierre said it will ask the court to confirm the plan by December, and expects to emerge from Chapter 11 shortly after the approval takes place.
"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," said Norbert Woodhams, chief executive officer of Pierre.
Mr. Woodhams added Pierre has made "great progress" in its efforts to restructure, including eliminating more than $225 million of debt.
As part of its plan, Pierre said it hopes to convert $100 million of existing prepetition secured indebtedness to 100% of the equity of reorganized Pierre; convert $50 million of existing prepetition secured indebtedness to a new mezzanine facility; and create a new exit facility to fund the company’s ongoing operations and pay obligations under the plan.