- The Washington Times - Tuesday, December 2, 2008

MILWAUKEE

Pilgrim’s Pride Corp., the nation’s largest chicken producer, filed for Chapter 11 bankruptcy protection Monday, hobbled by its debt load and volatile feed prices.

The Pittsburg, Texas-based company sought bankruptcy protection in a filing with the U.S. Bankruptcy Court for the Northern District of Texas on Monday, saying that as of Sept. 27 it had $3.75 billion in assets and $2.72 billion in debts.

Pilgrim’s Pride spokesman Ray Atkinson said the company was reorganizing and not liquidating its assets, and that it will keep operating throughout the reorganization process.

The chicken producer has been saddled by the debt from its $1.3 billion acquisition of rival Gold Kist Inc. in 2007 - what analysts cite as the primary cause of its large debt load.

Pilgrim’s Pride’s financial problems have been known for months, since it said in late September it would post a “significant loss” in the fourth quarter, citing woes from hedging of feed inputs like corn. It has had to extend its temporary credit line three times since September. Its third extension was set to expire Monday afternoon.

After the market closed Friday, the poultry producer said in a filing with the Securities and Exchange Commission that it would delay filing its 2008 annual financial report, which had been due Nov. 26.

The nation’s meat producers, especially Pilgrim’s Pride, are hurting as their profits shrink in the wake of high commodity prices for key inputs like corn and oil.

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