Allens Inc. files Chapter 11; promises to pay for produce

10/31/2013 11:38:00 AM
Coral Beach

Food processor Allens Inc., known for canned vegetable brands such as Popeye Spinach and Veg-All, is reorganizing under Chapter 11 bankruptcy laws, but has promised produce suppliers — most of them specializing solely in vegetables for processing — it will pay for all goods it buys in the wake of the bankruptcy.

The Siloam Springs, Ark., company, also known as Allens Canning Co., filed for debt reorganization Oct. 28. Company officials set up a Web page — www.allens-restructuring.com — to explain their plans to customers and creditors. The bankruptcy filing indicates between 1,000 and 5,000 creditors are owed between $100 million and $500 million.

“Allens fully intends to operate our business in the ordinary course throughout this process,” said president Joshua Allen in a letter to suppliers on the Web page.

“Please note that the company intends to pay for all goods and services received at its facilities after the filing date Oct. 28.”

Federal law prohibits Allens Inc. from paying any debts owed before the Oct. 28 filing, according to Allen’s letter.

“Creditors will be able to file a claim for any pre-petition amounts owed to them. Additional information regarding the claims process will be sent to creditors as soon as it is available,” according to the statement.

The Web page has links for produce suppliers that provide information about the claims process and court filings in the case.

Many of the top 20 creditors listed with in Allens’ bankruptcy filing are suppliers that provide fresh produce to processors. Even though the produce is not sent to end-users as fresh, sellers are covered by the protections in the Perishable Agricultural Commodities Act (PACA), said Gwen Sparks, a spokeswoman for the Agricultural Marketing Service of the U.S. Department of Agriculture.

Among the top 20 creditors and the amounts owed are:

  •  Hartung Brothers Inc., Madison, Wis., $7.8 million;
  •  Razorback Farms Inc., Springdale, Ark., $4.1 million;
  •  D&E Farms Inc., Spring Grove Pa., $1.9 million;
  •  Paramount Farms Inc., Plainfield, Wis., $1.7 million;
  •  Worzella & Sons Inc., Plover, Wis., $1.2 million;
  •  H.C. Schmieding Produce Co. Inc., Springdale, Ark., $1.2 million;
  •  Bushman Associates Inc., Wittenberg, Wis., $950,800;
  •  Syngenta Seeds Inc., Minnetonka, Minn., $829,000;
  •  Triple S Farms, Hydro, Okla., $515,000;
  •  Okray Family Farms Inc., Plover, Wis., $515,000; and
  •  J&J Potatoes & Farm Credit NCW, Wittenberg, Wis., $427,000.



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