Reorganization of Pilgrim's Pride completed

by Bryan Salvage
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PITTSBURG, TEXAS — Pilgrim's Pride Corporation and six of its subsidiaries have emerged from Chapter 11 bankruptcy protection after a 13-month restructuring, the company announced earlier on Dec. 28.

"Pilgrim's Pride today begins a new chapter as a market-driven company clearly focused on delivering the highest levels of service, selection and value to our customers as efficiently as possible," said Don Jackson, president and chief executive.

"Over the past 13 months, we have made significant improvements across our organization aimed at positioning Pilgrim's Pride to respond quickly to the needs of the market," he added. "Those changes have touched every aspect of our business, from supply chain and operations to sales and marketing."

The company has entered into a $1.75 billion exit credit facility with CoBank, ACB, as administrative agent and collateral agent; CoBank, Bank of Montreal and Rabobank International, as joint syndication agents; CoBank, Rabobank, Bank of Montreal, Barclays Capital, Morgan Stanley Senior Funding Inc. and ING Capital LLC, as joint lead arrangers and joint bookrunners; and Barclays Bank PLC, Morgan Stanley Senior Funding Inc. and ING Capital LLC as joint documentation agents.

According to a news release, the exit credit facility is secured by all of the company's assets. Under the 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.

All shares of the company's common stock outstanding immediately before the effective date of the plan were cancelled and converted on a one-for-one basis into the right to receive new shares of the reorganized company, under the terms of the confirmed plan. 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 will begin trading Dec. 29 on the New York Stock Exchange under the symbol "PPC."

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