Allens Inc. for Sale, Bankruptcy Filings Show

by Mark Friedman  on Monday, Nov. 25, 2013 12:00 am  

Publicly, Allens put a positive spin on the move.

“The transaction will allow the Allens organization to focus intently in the future on its core competencies: canned and Southern-style frozen vegetables,” Allens said in a news release at the time.

Rick Allen, who was chairman and CEO of Allens at the time, said in the release that he was happy with the sale.

“With this renewed concentration, we anticipate greater growth, more innovation and even better customer service and product quality,” he said.

Allens’ restructuring helped bring its EBITDA to $24.2 million for fiscal 2012.

“However, the Company’s margins remained below historical levels,” Hickman said. Allens “continued to experience operational difficulties … and began to experience severe liquidity constraints.”

Hickman didn’t provide details on what the liquidity constraints were.

Chapter 11

After limping through this year, Allens tried to improve its working capital and was in talks with a “third party to secure an equity investment,” Hickman said. Hickman didn’t name the third party in his report, but the deal also fell apart.

Hickman said the management team worked hard to improve Allens’ books, but unfortunately, it has “continued to struggle to implement its business plan while attempting to at the same time service their debt.”

He said the company’s only option was to file for Chapter 11 bankruptcy and hope to find a buyer or investor or to restructure its debt.

The company said in a news release that it plans to make it through the bankruptcy.

“Allens has a long and proud history and we intend to use the reorganization process to become a stronger, more competitive business,” Josh Allen, president and CEO of Allens, said in the news release that announced the bankruptcy. “We remain firmly committed to serving our customers and providing consumers with great-tasting, affordable and high-quality vegetables.”

 

 

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