Pilgrim’s Pride Corporation
emerges from bankruptcy
Jan 2, 2010 2:42 PM
Pilgrim’s Pride Corporation and six of its subsidiaries have emerged from Chapter 11 bankruptcy protection after a 13-month restructuring.
In connection with its emergence, the company has entered into a $1.75 billion exit credit facility. The exit credit facility is secured by substantially all of the company’s assets. Under terms of the company’s plan of reorganization, all creditors of the company and its debtor subsidiaries holding allowed claims will be paid in full as soon as practicable. In the case of bondholders, payment will be made either through reinstatement of the bonds or in accordance with the holder’s previous election of a cash-out option.
Under terms of the confirmed plan, all shares of the company’s common stock outstanding immediately prior to the effective date of the plan were canceled and converted on a one-for-one basis into the right to receive new shares of the reorganized company. The reorganized company issued 64% of its common stock to JBS USA Holdings Inc in exchange for $800 million in cash. The remaining 36% of the common stock of the reorganized company was issued to stockholders existing immediately prior to the effective date. Proceeds from the sale of the common stock of reorganized Pilgrim’s Pride to JBS are being used to fund cash distributions to unsecured creditors.
The reorganized company’s common stock has begun trading on the New York Stock Exchange under the symbol “PPC.”
Pilgrim’s Pride also announced the elimination of approximately 230 corporate and administrative positions across the organization under the first phase of its integration with JBS USA. About 160 of the primarily salaried and salaried non-exempt positions being eliminated are based at the company’s headquarters in Pittsburg TX or in nearby Mt Pleasant TX. The remaining positions being eliminated are spread over nearly a dozen other sites, including Atlanta GA, Dallas TX, and Broadway VA. The company will provide severance benefits, including outplacement assistance, to affected salaried and salaried non-exempt employees. There is no direct impact on Pilgrim’s Pride’s operations or production, as none of the positions being eliminated are production-related.
The company said it is moving forward with plans to consolidate most corporate functions at JBS USA’s headquarters in Greeley CO.
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