Cimino Bros. Produce, Salinas, Calif., is in Chapter 11 bankruptcy proceedings, with about 200 creditors owed from $10 to $50 million.
According to court documents filed Nov. 24, company partners Armand Cimino, who has a 25% stake, Stephanie Cimino, who holds another 25% stake, and Vincent Cimino, who holds a 50% stake in the company, voted unanimously Nov. 14 to enter Chapter 11 bankruptcy protection.
âThis reorganization is important, not only to the general credit body and my family, but also our many employees in the United States and Mexico, as well as the Mexican growers of produce,â Vincent Cimino said in the court filings.
Cimino Bros. did not return requests for comment Dec. 18.
Cimino Bros. is year-round grower-shipper primarily of broccoli with operations in Mexico under Cimino Bros. Co. Produce Mexico, formed in 1998. The company developed the largest national network of Asian foodservice distributors, according to court filings. The company also owns a cooler in Laredo, Texas, and reported strong growth between 2004 and 2007 when revenues jumped from $14.6 million to $20.7 million.
But heavy rainfall and low yields in 2007 ârestrained the growth pathâ the company aimed for that year, according to court filings, and grower advances coupled with low yields and bad weather affected the 2008 growing season and the companyâs cash flow.
Problems with weather in Mexico and a carton supplier cost Cimino Bros. $6.5 million in 2008 and a lawsuit, according to court documents, further affected cash flow for the year and money needed for capital expenses. This year, Wells Fargo, which is owed more than $6 million, pulled its funding from Cimino Bros., according to court documents. The company was unable to secure additional bank loans in time leading to an ongoing dispute between the company and Wells Fargo over seized accounts.