Del Monte Foods Files for Bankruptcy Protection, Pursues Sale

US-based plant-based food company Del Monte Foods announced it is pursuing the sale of the company as part of a strategic balance-sheet restructuring, a process that will be facilitated by a voluntary Chapter 11 bankruptcy filing.

The company and certain affiliates commenced proceedings in the US Bankruptcy Court for the District of New Jersey. The filing is supported by a group of existing lenders through a Restructuring Support Agreement (RSA), which outlines a plan for a court-supervised sale of all or substantially all of the company’s assets. 

Del Monte stated that the goal is to obtain the best offer to maximize value for its stakeholders. "After a thorough evaluation of all available options, we determined that 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,” said Greg Longstreet, President and CEO, Del Monte Foods.

To fund its operations during the process, Del Monte has secured a commitment for US$912.5 million in debtor-in-possession (DIP) financing, which includes US$165 million in new funding, subject to court approval. The company stated this financing is expected to provide sufficient liquidity to continue business operations in the ordinary course, including its current pack season.

Del Monte also filed several "first day" motions to ensure it can continue to run its business and deliver products without interruption. The company noted that its non-US subsidiaries are not included in the Chapter 11 proceedings and will operate as usual. “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," Longstreet concluded.

Fresh Del Monte Produce Detaches From Del Monte Foods' Bankruptcy Filing

In a press release, Fresh Del Monte Produce clarified it has no relation to Del Monte Foods, as the former is a fully independent, publicly traded company with no financial or operational affiliation with the latter. “While both businesses share rights to the Del Monte® name through historical licensing arrangements, they operate under distinct ownership and serve different geographic markets. Fresh Del Monte continues to operate with full stability and focus. The company remains financially strong, strategically aligned, and committed to delivering long-term value,” reads Fresh Del Monte Produce’s press release.