NEW YORK — Del Monte Foods has filed for Chapter 11 bankruptcy in the United States and initiated a formal sale process, marking a major turn for the canned fruit giant less than a year after a contentious debt restructuring. The move is aimed at facilitating a financial turnaround and securing new ownership.
The company, a subsidiary of Singapore-listed Del Monte Pacific, announced on July 1 that it had entered into a restructuring support agreement with its lenders. As part of the plan, it secured US$912.5 million (S$1.16 billion) in debtor-in-possession financing, which includes US$165 million in new capital from existing lenders.
According to a filing in the United States Bankruptcy Court for the District of New Jersey, Del Monte Foods’ liabilities and assets are each estimated between US$1 billion and US$10 billion. The court-supervised process is designed to allow Del Monte Foods to sell most or all of its assets while continuing day-to-day operations.
Shares of parent company Del Monte Pacific dropped by 6.25 percent to six Singapore cents as of 4.19pm on July 2. The company is also listed on the Philippine Stock Exchange. The bankruptcy filing follows a difficult period for Del Monte Foods and its parent, including a legal dispute earlier this year. In June, Del Monte Pacific chose to skip a payment to its U.S. unit’s lenders as part of a legal settlement involving the 2024 debt restructuring.
That restructuring, which sparked a lawsuit, involved a strategy known as a “drop-down transaction.” In this arrangement, the company shifted valuable assets into a separate entity, enabling it to borrow more money backed by those assets. The deal gave preferential treatment to participating lenders and established new repayment tiers, leaving other creditors sidelined.
In a statement, Del Monte Foods said the restructuring agreement allows it to maintain operations, continue serving customers, and complete the sale process with adequate liquidity from the financing and its ongoing business revenue.
“This is a strategic step forward for Del Monte Foods,” said CEO Greg Longstreet. “After a comprehensive review of our options, we concluded that a court-supervised sale offers the clearest path to accelerating our recovery and securing a stronger future for the company.”
The outcome of the sale process will likely determine the next chapter for the legacy food brand, which has been grappling with market challenges and mounting debt pressures in recent years.