FRIDLEY, MINNESOTA, US — Pipeline Foods, a US-based supply chain solutions company focused exclusively on organic, non-GMO and regenerative food and feed, announced on July 9 that it has filed for relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware.
“The impact of the coronavirus (COVID-19) pandemic coupled with the company’s secured debt obligations have caused significant financial distress on our business,” said Anthony Sepich, chief executive officer of Pipeline Foods. “As a result, we believe that a bankruptcy filing and a potential sale of the business, portions of the business, and certain of its assets is the best path forward to unlock value for the benefit of all creditors. I would like to thank all of our employees, growers, customers, and business partners for their dedication and continued support through these unprecedented times.”
Pipeline Foods said it will begin filing customary motions with the bankruptcy court that will authorize it to operate within a cash collateral budget, allowing for the payment of employee wages and benefits without interruption.
Pipeline Foods said it expects to seek approval to sell its grain inventory outside of the ordinary course at market prices in an effort to facilitate the company’s use of cash collateral.
The first hearing in the company’s bankruptcy court case is set for July 14.Founded in 2017 and headquartered in Minneapolis, Minnesota, US, Pipeline Foods set out to put more profits back into the hands of farmers while creating dependability and transparency for food companies and offering unique investment opportunities for financial partners. Over the past several years the company has expanded through acquisitions, including the 2019 acquisitions of the ancient grains and specialty products business of Organic Ventures and the specialty and organic soy and corn business of SunOpta Inc. In 2018, Pipeline acquired a 3.4-million-bushel grain elevator in Atlantic, Iowa, US, from ADM. At the time, Pipeline Foods said it planned to make capital investments in new equipment at the facility. Additionally, plans called for improvements to upgrade the elevator to test, clean, grade, dry, store and ship organic grains.