Del Monte Foods, the well-known producer of canned and packaged foods, has declared Chapter 11 bankruptcy. This move is a big change, indeed, for the long-established giant. The company filed voluntary Chapter 11 proceedings in the U.S. Bankruptcy Court for the District of New Jersey on July 1. Founded in 1886, Del Monte has more than 139 years of history and is based in Walnut Creek, California.
The bankruptcy filing occurs as Del Monte has been struggling with a host of issues largely due to macroeconomic forces. The company has obtained a $912.5 million commitment from its lenders to finance its continuing business operations during this transition period. Del Monte’s management touted the Chapter 11 as a “strategic move in the right direction.” Their mission is to repurpose, reimagine and meet what the market demands today.
Del Monte’s President and CEO, Greg Longstreet, in an interview with Food Business News described the reasoning behind the move.
“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,” – Greg Longstreet.
Like many industries today, the canned foods industry is adapting to a rapidly changing landscape shaped by a host of economic factors. These tariffs have already led to tremendous increases in production costs and consumer prices. On June 4, these tariffs were doubled from 25% to 50%, pushing a significantly pressured industry over the edge.
Del Monte currently is in the midst of its own restructuring. The company’s goal is to use its great reputation and dedication to quality as a springboard to become even better during this process. Backing from lenders will help ensure it has the operating cash it needs to weather this complicated new chapter in its storied history.
“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,” – Greg Longstreet.
As Del Monte moves forward with its restructuring efforts, the company aims to leverage its long-standing reputation and commitment to quality to emerge stronger from this process. The support from lenders will provide essential funding to sustain operations while navigating this complex chapter in its history.
