Del Monte Foods has initiated Chapter 11 bankruptcy proceedings in the United States, filing on Tuesday as part of an agreement with key lenders to facilitate a sale of the company.
The move comes with a secured financing package of $912.5 million, intended to support its operations throughout the restructuring process.
Despite the bankruptcy filing, the 139-year-old food giant has affirmed its intention to remain open and continue its operations without interruption.
Known as one of the biggest US household brands, Del Monte first emerged in 1886 and expanded in the 1890s.
The company later built its famous ‘The Cannery’ in San Francisco in 1907 and claimed that it operated the largest fruit and vegetable cannery in the world by 1909.
Del Monte Foods is widely recognised for its extensive portfolio of household brands, including its namesake canned fruits and vegetables, College Inn broths and stocks, and Joyba tea products.
Court documents filed in New Jersey estimate the company's assets and liabilities to be in the range of $1 billion to $10 billion.
The filing also indicates a substantial number of creditors, estimated to be between 10,000 and 25,000.
In a statement, CEO Greg Longstreet said: “This is a strategic step forward for Del Monte Foods. After a thorough evaluation of all available options, we determined a court-supervised sale process is the most effective way to accelerate our turnaround and create a stronger and enduring Del Monte Foods.
“With an improved capital structure, enhanced financial position and new ownership, we will be better positioned for long-term success”.
He added: “While we have faced challenges intensified by a dynamic macroeconomic environment, Del Monte Foods has nourished families for nearly 140 years, and we remain committed to our mission of expanding access to nutritious, great-tasting food for all.
“I am deeply grateful to our employees, growers, customers and vendors, as well as our lenders for their support in helping us achieve our long-term goals".
Certain of its non-US subsidiaries are not included in the Chapter 11 proceedings and continue to operate as usual, Del Monte Foods said.
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