Source:  Rita Jane Gabbett, MEATINGPLACE.COM, 12/20/10

Georgetown, Del.-based Townsends, Inc. and four wholly owned subsidiaries announced they have filed voluntary petitions for relief under Chapter 11 of the United States Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware.

All of the operations are expected to continue during the bankruptcy process as the company explores strategic alternatives.

In conjunction with the filing, the company is seeking approval to enter into a $52 million debtor-in-possession financing facility, to enable normal operation of its business, including the timely payment of employee wages and other obligations.

During the Chapter 11 process, suppliers should expect to be paid for post-petition purchases of goods and services in the ordinary course of business, the company stated.

"Since 2008, our company has been impacted by record high feed-ingredient costs on the one hand and low chicken pricing on the other," said Chief Executive Officer Frederick Beilstein III, in a news release.

 "The company's management and its board of directors determined that a Chapter 11 filing was a necessary part of the company’s restructuring. We believe that it will allow us to best serve our stakeholders, including our customers, our vendors and our employees.”

Townsends Inc. is a third-generation, family-owned, vertically integrated poultry processer. Since its founding in 1891, it has grown to a leading poultry processor. The company sold 683 million pounds of poultry products in 2009.

Townsends operates facilities in Arkansas, North Carolina and Georgia. Its brands include Chef’s Select, Perfect Breast, Pristine Cuisine, Ruby Dragon, Speedy Bird and Zabiha Halal.
 

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