Struggling grocery retailer closes after bankruptcy dismissed

Over the past two years, retail food brands have faced economic difficulties, including rising business costs caused by inflation, rising interest rates and other industry-related factors.

Leroux Creek Food, an organic fruit and vegetable canner, filed for Chapter 11 protection in August to reorganize its debts as it faced financial difficulties.

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In addition to fruits and vegetables, the poultry industry has experienced some economic problems caused by falling prices instead of inflation.

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Poultry prices fell in October 2022, leading to financial difficulties and bankruptcy filings that led to the bankruptcy of some companies.

Decatur, Ark.-based chicken producer Cooks Ventures closed operations at the end of 2023 and filed for Chapter 7 bankruptcy in the District of Delaware in April 2024.

The company secured funding a few times totaling about $62 million to expand operations, but that wasn’t enough to keep the company afloat.

Fresh chicken producer Pure Prairie Poultry went out of business on Oct. 2 and unexpectedly laid off all of its plant employees after a bankruptcy judge on Sept. 27 dismissed its Chapter 11 bankruptcy filing company, according to KCHAnews.com.

“While we continue to explore options, including potential buyers for our operations, our efforts to restart the plant on a limited basis have been unsuccessful,” George Piechel, owner of the chicken processing plant, said in a statement. “Without a viable operating plan, we are ceasing operations at our Charles City manufacturing facility effective immediately.”

Pure Prairie Poultry’s Chapter 11 bankruptcy has been dismissed.

Pure Prairie Birds

Pure Prairie Poultry filed for bankruptcy discharge

On Sept. 25, Pure Prairie Poultry filed a motion in the U.S. Bankruptcy Court for the District of Minnesota seeking to dismiss the Chapter 11 case after its secured creditor Community Bank and Trust objected to the debtor-in-possession financing proposal. 15 million dollars of the poultry company. Stanton Capital Solutions.

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Without CB&T’s consent to provide collateral to support the DIP loan, the debtor was unable to obtain the loan from Standton and lacked the liquidity to continue operating while seeking a Chapter 11 bankruptcy restructuring.

Judge Katherine A. Constantine signed an order on September 27 dismissing and closing the bankruptcy case.

More bankruptcy stories:

• Retail chain Big Lots is poised to file for Chapter 11 bankruptcy
• Manufacturers of popular retail products file for Chapter 11 bankruptcy
• The mattress company’s rival files for Chapter 11 bankruptcy

The Charles City, Iowa-based company said it would seek either a sale of its assets or an out-of-court restructuring after rejecting bankruptcy and laying off all of its employees.

Pure Prairie Poultry filed for Chapter 11 on Sept. 20, seeking to restructure its business and remain a going concern. The company listed assets of $50 million to $100 million and liabilities of $100 million to $500 million in its petition and sought up to $15 million in debt financing in possession to finance operations by closing his bankruptcy case.

The debtor acquired its poultry plant in Charles City in December 2021 and spent nearly a year renovating and upgrading the facilities before launching whole chicken production operations in November 2022. The company sought to upgrade the plant to serve premium chicken and organic brand and private label. retail market in six Midwestern states, including Iowa, Minnesota, Missouri, Nebraska, North Dakota and South Dakota.

The company sold its chicken products to 213 grocery stores in the Midwest before ceasing operations, according to its website.

The company qualified for a loan of about $39 million under the federal Food Supply Chain Guaranteed Loan Program in April 2022 to help cover the costs of upgrading its plant, and the company was confident about the future because poultry prices have reached an all-time high. in July 2022.

The company’s goal was to initially start selling whole chickens in November 2022 and expand processing to other chicken products once it received federal funding.

However, poultry prices fell in October 2022 and would remain low for about a year. While the borrower received approximately $7 million in federal grant funds on October 20, 2022, which it planned to use as deficit financing until it received higher loan proceeds, its federal loan did not close until April 2023 .

The delay in funding caused financial difficulties for the poultry producer, as the renovation of its factory was not completed until November 2023, more than a year and a half after it qualified for the loan.

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