How can a century(plus)-old model fall into the place the place Chapter 11 seems the best choice to assist the enterprise?
That’s the query hanging over Del Monte Meals, the almost 140-year-old firm that this week introduced it was coming into Chapter 11 proceedings and is searching for a brand new proprietor.
“It is a strategic step ahead for Del Monte Meals,” president and CEO Greg Longstreet mentioned on Tuesday. “A court-supervised sale course of is the simplest technique to speed up our turnaround and create a stronger and enduring Del Monte Meals.”
The corporate, greatest identified for its namesake model of canned fruit and greens, has been owned since 2014 by Singapore and Philippines-listed Del Monte Pacific.
Based mostly in California, Del Monte Meals can also be residence to manufacturers together with School Inn broths and shares and Joyba teas. With gross sales having just lately come below strain, laden with extra stock and carrying debt from the Del Monte Pacific deal, the corporate has struck a “restructuring assist settlement” with collectors to pursue a “going-concern sale course of for all or considerably all” of its property.
Del Monte Meals says it has secured a dedication from its lenders for $912.5m in debtor-in-possession financing to maintain the enterprise going whereas a possible suitor is sought. It contains $165m in new funding, which is topic to courtroom approval.
The group has 4 factories – two within the US and two in Mexico. In Could, the corporate shut a plant in Washington state. The closure adopted three others final 12 months.
“With an improved capital construction, enhanced monetary place and new possession, we will likely be higher positioned for long-term success,” Longstreet added.
It’s vital to notice that Del Monte Meals is distinct from the publicly listed – and fresh-foods-focused – Contemporary Del Monte Produce. That firm felt compelled to difficulty its personal assertion yesterday to underline it’s not affiliated to Del Monte Meals.
“Contemporary Del Monte Produce Inc.’s monetary or operational efficiency isn’t impacted by that separate, unaffiliated firm’s introduced authorized or monetary proceedings,” it mentioned. “The corporate stays financially robust, strategically aligned, and dedicated to delivering long-term worth.”
Contemporary Del Monte Produce does personal the Del Monte model for ready meals merchandise in Europe, Africa, and the Center East – however Del Monte Meals holds the rights to the Del Monte model for ready meals merchandise within the US.
And therein lies a part of the rationale for Del Monte Meals’ woes. The corporate’s vary of shelf-stable merchandise attraction much less to the rising variety of customers within the US who’re trying as a substitute for minimally-processed, fresh-cut choices.
For Eddie Pearson, associate at US consultancy BeyondBrands, Del Monte Meals’ transfer into Chapter 11 “isn’t only a chapter story – it’s a snapshot of how rapidly client preferences are rewriting the meals aisle”.
“After almost 140 years of maintaining America shelf-stable, the enduring canned meals model is restructuring. Why? As a result of customers have formally damaged up with the can opener,” Pearson wrote on LinkedIn this week. “The fashionable shopper desires contemporary over shelf life, natural over synthetic, farmers’ market vibes over ‘non-BPA liner’ labels. Positive, Joyba bubble tea continues to be having its second. However canned peaches? They’re getting ghosted.”
Del Monte Meals might also have been squeezed otherwise. These US consumers who are common consumers of its sort of canned fare might, in latest months, have been extra drawn to the lower-price choices offered below retailer personal labels, particularly at a time when client confidence has been below strain.
The corporate does manufacture merchandise for US retailers’ personal labels however, because the Chapter 11 filings conceded, that facet of the enterprise “has contracted considerably” after the latest plant closures.
The latest rigidity over tariffs, particularly the price of inputs to make cans, would possible not have helped both. US trade physique Shopper Manufacturers Affiliation has been vocal in its considerations concerning the US transfer to place tariffs on metal and aluminium.
On prime of all that, Del Monte Meals has held extra stock within the wake of the Covid-19 pandemic. The corporate’s gross sales had been boosted throughout the worst of the pandemic amid the spike in at-home consumption and the short-term flight to well-known and staple manufacturers. That elevated demand didn’t final.
Then there are inner elements. Del Monte Meals has carried a pile of debt from the sale to Del Monte Pacific greater than a decade in the past. Within the firm’s Chapter 11 submitting, it mentioned its annual money curiosity prices stood at $66m in its 2020 fiscal 12 months – however jumped to $125m in fiscal 2025 as its capital construction was refinanced and rates of interest elevated.
Within the wake of Del Monte Meals’ assertion on Tuesday, the value of Del Monte Pacific’s shares listed in Singapore fell. Del Monte Pacific sought to underline its Asian and different worldwide companies proceed “to carry out nicely, with resilient client demand, supported by a robust and secure provide chain”. The corporate added it’s evaluating the potential influence of the Del Monte Meals’ chapter course of, together with any impairment prices that must be disclosed in future reporting.
Nonetheless, in response to Del Monte Pacific’s annual report for fiscal 2024, Del Monte Meals accounted for 70% of its guardian’s gross sales.
And people in logistics will likely be watching the state of affairs carefully. Logistics teams together with CHEP USA, Saddle Creek and Uber Freight (as Transplace) are listed within the filings as collectors.
“Throughout the court-supervised course of, Del Monte Meals will proceed to meet buyer orders throughout our portfolio of beloved manufacturers throughout this course of,” the group mentioned. “The corporate can have adequate liquidity to proceed paying distributors and suppliers for items and companies offered after the submitting date. Our group stays targeted on delivering high-quality meals merchandise which might be wholesome, scrumptious and handy.”
What lies additional forward stays to be seen.
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How can a century(plus)-old model fall into the place the place Chapter 11 seems the best choice to assist the enterprise?
That’s the query hanging over Del Monte Meals, the almost 140-year-old firm that this week introduced it was coming into Chapter 11 proceedings and is searching for a brand new proprietor.
“It is a strategic step ahead for Del Monte Meals,” president and CEO Greg Longstreet mentioned on Tuesday. “A court-supervised sale course of is the simplest technique to speed up our turnaround and create a stronger and enduring Del Monte Meals.”
The corporate, greatest identified for its namesake model of canned fruit and greens, has been owned since 2014 by Singapore and Philippines-listed Del Monte Pacific.
Based mostly in California, Del Monte Meals can also be residence to manufacturers together with School Inn broths and shares and Joyba teas. With gross sales having just lately come below strain, laden with extra stock and carrying debt from the Del Monte Pacific deal, the corporate has struck a “restructuring assist settlement” with collectors to pursue a “going-concern sale course of for all or considerably all” of its property.
Del Monte Meals says it has secured a dedication from its lenders for $912.5m in debtor-in-possession financing to maintain the enterprise going whereas a possible suitor is sought. It contains $165m in new funding, which is topic to courtroom approval.
The group has 4 factories – two within the US and two in Mexico. In Could, the corporate shut a plant in Washington state. The closure adopted three others final 12 months.
“With an improved capital construction, enhanced monetary place and new possession, we will likely be higher positioned for long-term success,” Longstreet added.
It’s vital to notice that Del Monte Meals is distinct from the publicly listed – and fresh-foods-focused – Contemporary Del Monte Produce. That firm felt compelled to difficulty its personal assertion yesterday to underline it’s not affiliated to Del Monte Meals.
“Contemporary Del Monte Produce Inc.’s monetary or operational efficiency isn’t impacted by that separate, unaffiliated firm’s introduced authorized or monetary proceedings,” it mentioned. “The corporate stays financially robust, strategically aligned, and dedicated to delivering long-term worth.”
Contemporary Del Monte Produce does personal the Del Monte model for ready meals merchandise in Europe, Africa, and the Center East – however Del Monte Meals holds the rights to the Del Monte model for ready meals merchandise within the US.
And therein lies a part of the rationale for Del Monte Meals’ woes. The corporate’s vary of shelf-stable merchandise attraction much less to the rising variety of customers within the US who’re trying as a substitute for minimally-processed, fresh-cut choices.
For Eddie Pearson, associate at US consultancy BeyondBrands, Del Monte Meals’ transfer into Chapter 11 “isn’t only a chapter story – it’s a snapshot of how rapidly client preferences are rewriting the meals aisle”.
“After almost 140 years of maintaining America shelf-stable, the enduring canned meals model is restructuring. Why? As a result of customers have formally damaged up with the can opener,” Pearson wrote on LinkedIn this week. “The fashionable shopper desires contemporary over shelf life, natural over synthetic, farmers’ market vibes over ‘non-BPA liner’ labels. Positive, Joyba bubble tea continues to be having its second. However canned peaches? They’re getting ghosted.”
Del Monte Meals might also have been squeezed otherwise. These US consumers who are common consumers of its sort of canned fare might, in latest months, have been extra drawn to the lower-price choices offered below retailer personal labels, particularly at a time when client confidence has been below strain.
The corporate does manufacture merchandise for US retailers’ personal labels however, because the Chapter 11 filings conceded, that facet of the enterprise “has contracted considerably” after the latest plant closures.
The latest rigidity over tariffs, particularly the price of inputs to make cans, would possible not have helped both. US trade physique Shopper Manufacturers Affiliation has been vocal in its considerations concerning the US transfer to place tariffs on metal and aluminium.
On prime of all that, Del Monte Meals has held extra stock within the wake of the Covid-19 pandemic. The corporate’s gross sales had been boosted throughout the worst of the pandemic amid the spike in at-home consumption and the short-term flight to well-known and staple manufacturers. That elevated demand didn’t final.
Then there are inner elements. Del Monte Meals has carried a pile of debt from the sale to Del Monte Pacific greater than a decade in the past. Within the firm’s Chapter 11 submitting, it mentioned its annual money curiosity prices stood at $66m in its 2020 fiscal 12 months – however jumped to $125m in fiscal 2025 as its capital construction was refinanced and rates of interest elevated.
Within the wake of Del Monte Meals’ assertion on Tuesday, the value of Del Monte Pacific’s shares listed in Singapore fell. Del Monte Pacific sought to underline its Asian and different worldwide companies proceed “to carry out nicely, with resilient client demand, supported by a robust and secure provide chain”. The corporate added it’s evaluating the potential influence of the Del Monte Meals’ chapter course of, together with any impairment prices that must be disclosed in future reporting.
Nonetheless, in response to Del Monte Pacific’s annual report for fiscal 2024, Del Monte Meals accounted for 70% of its guardian’s gross sales.
And people in logistics will likely be watching the state of affairs carefully. Logistics teams together with CHEP USA, Saddle Creek and Uber Freight (as Transplace) are listed within the filings as collectors.
“Throughout the court-supervised course of, Del Monte Meals will proceed to meet buyer orders throughout our portfolio of beloved manufacturers throughout this course of,” the group mentioned. “The corporate can have adequate liquidity to proceed paying distributors and suppliers for items and companies offered after the submitting date. Our group stays targeted on delivering high-quality meals merchandise which might be wholesome, scrumptious and handy.”
What lies additional forward stays to be seen.
