Dive Transient:
- Del Monte Meals filed for chapter and is looking for a purchaser for its 139-year-old enterprise.
- The storied canned fruit and vegetable maker has “confronted challenges intensified by a dynamic macroeconomic surroundings,” CEO Greg Longstreet stated in an announcement.
- A sale of the California-based firm is “the simplest strategy to speed up our turnaround and create a stronger and enduring Del Monte Meals,” Longstreet added.
Dive Perception:
Few manufacturers are as recognizable on grocery retailer cabinets as Del Monte Meals. The notoriety, nevertheless, wasn’t sufficient to save lots of the weak firm from outdoors forces weighing on its enterprise.
Buyers have more and more in the reduction of on spending, boosted their purchases of personal label merchandise and shifted towards more energizing, more healthy alternate options, placing stress on Del Monte Meals. Tariffs on metal and aluminum even have weighed closely on canned meals companies.
Del Monte not solely has confronted a drop in demand for its merchandise, however the seasonality of its enterprise additionally probably means the corporate is paying extra to retailer its merchandise in warehouses. Del Monte has spent the final two years closing crops and warehouses, together with a fruit processing plant in Washington state final month.
Del Monte’s portfolio consists of its iconic canned fruit and veggies, Joyba Bubble Tea, Contadina tomato merchandise and Faculty Inn broths.
Even with the closures, the corporate noticed the necessity to take extra drastic steps to enhance its monetary image.
One other main problem for Del Monte Meals has been its debt.
The meals firm has handled rising curiosity funds tied to its acquisition by DMPL, which was funded by debt, in response to Bloomberg. It is also navigating constrained liquidity with curiosity funds now exceeding the corporate’s earnings earlier than curiosity, taxes, depreciation and amortization, the information service stated.
“With an improved capital construction, enhanced monetary place and new possession, we will likely be higher positioned for long-term success,” Longstreet stated.
Del Monte stated it secured $912.5 million in new financing. The cash, together with money from ongoing operations, ought to present adequate liquidity throughout the sale course of to fund the corporate’s operations. The corporate estimated liabilities between $1 billion and $10 billion, and it has as many as 25,000 collectors, in response to a court docket doc.
Del Monte stated the chapter shouldn’t influence its capacity to ship merchandise to shops.
The canned meals maker shouldn’t be the one firm going through challenges as shoppers extra intently watch their spending. A number of giant CPG firms this yr have introduced job cuts and plant closures, together with PepsiCo, Submit Holdings, Conagra Manufacturers and J.M. Smucker.
Dive Transient:
- Del Monte Meals filed for chapter and is looking for a purchaser for its 139-year-old enterprise.
- The storied canned fruit and vegetable maker has “confronted challenges intensified by a dynamic macroeconomic surroundings,” CEO Greg Longstreet stated in an announcement.
- A sale of the California-based firm is “the simplest strategy to speed up our turnaround and create a stronger and enduring Del Monte Meals,” Longstreet added.
Dive Perception:
Few manufacturers are as recognizable on grocery retailer cabinets as Del Monte Meals. The notoriety, nevertheless, wasn’t sufficient to save lots of the weak firm from outdoors forces weighing on its enterprise.
Buyers have more and more in the reduction of on spending, boosted their purchases of personal label merchandise and shifted towards more energizing, more healthy alternate options, placing stress on Del Monte Meals. Tariffs on metal and aluminum even have weighed closely on canned meals companies.
Del Monte not solely has confronted a drop in demand for its merchandise, however the seasonality of its enterprise additionally probably means the corporate is paying extra to retailer its merchandise in warehouses. Del Monte has spent the final two years closing crops and warehouses, together with a fruit processing plant in Washington state final month.
Del Monte’s portfolio consists of its iconic canned fruit and veggies, Joyba Bubble Tea, Contadina tomato merchandise and Faculty Inn broths.
Even with the closures, the corporate noticed the necessity to take extra drastic steps to enhance its monetary image.
One other main problem for Del Monte Meals has been its debt.
The meals firm has handled rising curiosity funds tied to its acquisition by DMPL, which was funded by debt, in response to Bloomberg. It is also navigating constrained liquidity with curiosity funds now exceeding the corporate’s earnings earlier than curiosity, taxes, depreciation and amortization, the information service stated.
“With an improved capital construction, enhanced monetary place and new possession, we will likely be higher positioned for long-term success,” Longstreet stated.
Del Monte stated it secured $912.5 million in new financing. The cash, together with money from ongoing operations, ought to present adequate liquidity throughout the sale course of to fund the corporate’s operations. The corporate estimated liabilities between $1 billion and $10 billion, and it has as many as 25,000 collectors, in response to a court docket doc.
Del Monte stated the chapter shouldn’t influence its capacity to ship merchandise to shops.
The canned meals maker shouldn’t be the one firm going through challenges as shoppers extra intently watch their spending. A number of giant CPG firms this yr have introduced job cuts and plant closures, together with PepsiCo, Submit Holdings, Conagra Manufacturers and J.M. Smucker.
