Earlier this month, on July 8, 2021, Pipeline Foods, LLC and its affiliated debtors (“Pipeline”) filed for Chapter 11 protection in the United States Bankruptcy Court for the District of Delaware. The debtors’ bankruptcy cases are jointly administered before the Honorable Karen B. Owens under Case No. 21-11002.
Pipeline’s Chief Executive Officer, Anthony Sepich, stated: “[t]he impact of the Coronavirus (COVID-19) pandemic coupled with the Company’s secured debt obligations have caused significant financial distress on our business. 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.”
Headquartered in Minneapolis, Minnesota, Pipeline has expanded through acquisitions over the past several years, including the acquisition of Organic Ventures, an ancient grains and specialty products business.
Pipeline’s strategy in the bankruptcy is to continue its operations, including operating within a cash collateral budget to pay employee wages and benefits without interruption and to use cash collateral. Pipeline will also evaluate strategic alternatives, including a sale of its assets to maximize recovery for its creditors. In this vein, Pipeline has requested authority to sell its commodities inventory by private sales outside of the ordinary course of business to facilitate the company’s use of cash collateral. A hearing to consider this requested relief is scheduled for July 30, 2021.
Pipeline is represented by Saul Ewing Arnstein & Lehr, LLP, and the claims agent for Pipeline is Stretto. Barnes & Thornburg LLP represents the Official Committee of Unsecured Creditors, which was formed on July 22, 2021.
Carl D. Neff is a partner with the law firm of FisherBroyles, LLP, and practices in Delaware. You can reach Carl at (302) 482-4244 or at Carl.Neff@FisherBroyles.com.