JBS purchases Pilgrim's Pride
JBS buying majority equity stake in reorganized company; emergence from Chapter 11 expected in December
Proceeds from the sale of the new common stock of the reorganized Pilgrim's Pride to JBS will be used to fund cash distributions to allowed claims under the plan. Under the terms of the plan, all creditors of the debtors named in the case will be paid in full. All existing Pilgrim's Pride common stock will be cancelled and existing stockholders will receive the same number of new common stock shares representing 36% of the reorganized Pilgrim's Pride in aggregate.
The plan also calls for an exit facility for senior secured financing in an aggregate principal amount of $1.75 billion to be provided by a group of lenders arranged by Joint Lead Arrangers CoBank, ACB and Rabobank.
Pilgrim's Pride said it expects the plan to be confirmed by the Bankruptcy Court in time for debtors to emerge from bankruptcy before the end of December.
"Over the past 10 months, we have fundamentally restructured Pilgrim's Pride as a market-driven company clearly focused on delivering the best service, selection and value to our customers as efficiently as possible," said Don Jackson, president and chief executive officer.
The plan and the proposed disclosure statement have yet to be approved by the Bankruptcy Court and are subject to further negotiations with stakeholders.
Pilgrim's filed voluntary Chapter 11 Dec. 1, 2008, and its operations in Mexico and certain operations in the U.S. were not included in the filing and continue to operate as usual.