WILDER, Idaho – CTI Foods, a major supplier to US restaurant chains and branded food companies, announced it filed for reorganization under Chapter 11 protection in the United States Bankruptcy Court for the District of Delaware.
The company also submitted a pre-packaged reorganization plan with the support of its stakeholders to go along with the bankruptcy filing.
CTI Foods reached an agreement with the majority of its lenders on a comprehensive balance sheet that will reduce its debt by more than $400 million.
“With the support of our lenders and equity sponsors, we are taking this positive and strategic step forward that will allow us to improve our capital structure and reduce our debt on an expedited basis while continuing to provide customers the custom food solutions and services they expect from CTI,” said Mike Buccheri, president and CEO of CTI. Buccheri was name to his position on March 11.
Along with the restructuring plan, CTI received $155 million in debtor-in-posession (“DIP”) financing from its lenders. If the court approves it, the company will use the financing to pay down existing debt and fund ongoing operations for the Chapter 11 case.
“With increased financial flexibility, we will be able to continue taking actions to best position CTI for long-term growth with both existing and new customers,” Buccheri continued. “It is a testament to the hard work of our employees and commitment to our customers’ success that many of our largest customers are not only standing by us through this process but are also increasing their business.”
The company said it will operate its business throughout the restructuring process.