GEORGETOWN, Del.– On Friday, January 28, 2011, Townsends, Inc. received final approval from the United States Bankruptcy Court for the District of Delaware for a $12 million debtor-in-possession financing facility. The company had received interim approval to access up to $7 million of the $12 million final facility.
Townsends also received approval for bid procedures for an auction process to sell the Company, in whole or in part. The process calls for bids by February 14, 2011, with the auction to follow on February 15, 2011. A hearing to consider approval of the sale is currently scheduled to be held before the Honorable Christopher S. Sontchi, United States Bankruptcy Judge, on February 17, 2011, with, if approved, a closing(s) anticipated very shortly thereafter.
“We are extremely gratified that our employees, customers and suppliers have shown tremendous support during this difficult time. After carefully considering the Company’s alternatives, the Company's management and its Board of Directors determined that a sale of all or part of the Company’s assets would provide the opportunity for the best outcome for all of our stakeholders,” said Frederick B. Beilstein III, Chief Executive Officer.
“Multiple bidders have expressed interest in acquiring the Company. The Company’s management and financial and legal advisors are working closely with interested bidders as we approach the anticipated February 15th auction and will continue to work with a successful bidder(s) to limit any disruption in operations during the transition process.”
The DIP financing facility, combined with cash flows generated from ongoing operations, allows the Company to continue its business operations on a normalized basis until the closing of the transaction(s).
On December 19, 2010, Townsends, Inc. and four wholly owned subsidiaries filed voluntary petitions for relief under chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware.
Townsends, Inc. is a third-generation, family-owned, vertically integrated poultry processer. Since its founding in 1891, it has grown to one of the leading poultry processing companies which sold 683 million pounds of poultry products in 2009. Headquartered in Georgetown, Delaware, the Company operates facilities in Arkansas, North Carolina and Georgia. Its brands include Chef’s Select, Perfect Breast, Pristine Cuisine, Ruby Dragon, and Speedy Bird.
For access to Court documents and other general information about the Chapter 11 cases, In re Townsends, Inc., et al., case No. 10-14092, including the above referenced Debtor-In-Possession Financing and Use of Cash Collateral Order, the Notice of Sale and the Order Approving Bidding Procedures, etc., please visit www.donlinrecano.com/townsends.
Source: Donlin Recano & Company, Inc.