Chiquita to File for Bankruptcy
CINCINNATI - Chiquita Brands International Inc. today announced that it has reached agreements with bondholder committees in support of a restructuring plan that will reduce Chiquita's debt and accrued interest by more than $700 million and its future annual interest expense by about $60 million. As anticipated in its January announcement of the restructuring initiative, the company will soon file in Federal Court a Pre-Arranged Plan of Reorganization under Chapter 11 of the U.S. Bankruptcy Code.
The restructuring plan will only involve the publicly held debt and equity securities of Chiquita Brands International Inc., which is a holding company without any business operations of its own. The company's other creditors and its assets, strategy and ongoing operations will be unaffected by the Chapter 11 filing. The company's subsidiaries, which are independent legal entities that generate their own cash flow and have access to their own credit facilities, will continue to operate normally and without interruption. Throughout the process, the company's customers will continue to receive shipments normally and its suppliers will continue to be paid in full according to normal terms.
Steven G. Warshaw, president and CEO of Chiquita, said: "We are pleased to have achieved this important milestone in the restructuring initiative we launched in January. This restructuring and the recent settlement of the U.S.-EU banana trade dispute are both significant events that will reinforce Chiquita's prospects for strong revenue and earnings growth. Now that we have reached agreement with the bondholder committees, we are confident that we can complete the Chapter 11 process within 90 to 120 days after we file our Pre-Arranged Plan, giving the company a fresh start and a solid balance sheet."
The restructuring plan will only involve the publicly held debt and equity securities of Chiquita Brands International Inc., which is a holding company without any business operations of its own. The company's other creditors and its assets, strategy and ongoing operations will be unaffected by the Chapter 11 filing. The company's subsidiaries, which are independent legal entities that generate their own cash flow and have access to their own credit facilities, will continue to operate normally and without interruption. Throughout the process, the company's customers will continue to receive shipments normally and its suppliers will continue to be paid in full according to normal terms.
Steven G. Warshaw, president and CEO of Chiquita, said: "We are pleased to have achieved this important milestone in the restructuring initiative we launched in January. This restructuring and the recent settlement of the U.S.-EU banana trade dispute are both significant events that will reinforce Chiquita's prospects for strong revenue and earnings growth. Now that we have reached agreement with the bondholder committees, we are confident that we can complete the Chapter 11 process within 90 to 120 days after we file our Pre-Arranged Plan, giving the company a fresh start and a solid balance sheet."