Borden Dairy Inc., one of the largest milk producers in the United States, announced it would file for Chapter 11 bankruptcy protection, becoming the second major dairy company to do so in the past two months.
Dean Foods, the largest milk producer in America, filed for bankruptcy on Nov. 12.
Borden said in a statement that it filed for bankruptcy because it cant afford its debt load and pension obligations. The firm currently has about 3,300 employees.
“We must achieve a more viable capital structure,” said Borden CEO Tony Sarsam in a statement. “This reorganization will strengthen our position for future prosperity. Over the past 163 years, we have earned the distinction of being one of the most well-recognized and reputable national brands.”
In the bankruptcy filing, Borden listed estimated debts and liabilities ranging between $100 million and $500 million, according to the Dallas Business Journal. It filed the claim in the U.S. Bankruptcy Court for the District of Delaware.
Sarsam told the Business Journal on Sunday that Bordens bankruptcy cannot be compared with Deans bankruptcy filing.
“Our situation differs in fairly significant ways,” Sarsam said. “All of our businesses are EBIDTA-positive and were growing. Dean is shrinking, and theyve been negative for multiple quarters in a row. Their filing was largely about operational problems they couldnt solve,” said Sarsam.
Dean Foods, meanwhile, reported losses in seven of the last eight quarters, according to the report.
“Unlike a lot of companies in this situation, were still focused on our people,” Sarsam said. “A lot of companies will raise the white flag on employee recognition and pay increases. Were not going to do any of that. Its business as usual.”
But Bordens statement said that its business has been impacted by broader dairy trends.
“Despite our numerous achievements during the past 18 months, the comRead More – Source