|
Del
Monte has secured $912.5 million in debtor-in-possession
financing that will allow it to operate normally as the sale
progresses.
“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,” CEO Greg Longstreet said in a
statement.
Del Monte Foods, based in Walnut Creek, California, also owns
the Contadina tomato brand, College Inn and Kitchen Basics broth
brands and the Joyba bubble tea brand.
The company has seen sales growth of Joyba and broth in fiscal
2024, but not enough to offset weaker sales of Del Monte's
signature canned products.
“Consumer preferences have shifted away from preservative-laden
canned food in favor of healthier alternatives,” said Sarah
Foss, global head of legal and restructuring at Debtwire, a
financial consultancy.
Grocery inflation also caused consumers to seek out cheaper
store brands. And President Donald Trump’s 50% tariff on
imported steel, which went into effect in June, will also push
up the prices Del Monte and others must pay for cans.
Del Monte Foods, which is owned by Singapore's Del Monte
Pacific, was also hit with a lawsuit last year by a group of
lenders that objected to the company’s debt restructuring plan.
The case was settled in May with a loan that increased Del
Monte’s interest expenses by $4 million annually, according to a
company statement.
Del Monte said late Tuesday that the bankruptcy filing is part
of a planned sale of company’s assets.
All contents © copyright 2025 Associated Press. All rights reserved
|
|
