Pierre Foods granted final approval for $35 million DIP facility

By Jennifer Lanning Drey

Portland, Ore., Aug. 13 - Pierre Foods, Inc. obtained final approval from the U.S. Bankruptcy Court for the District of Delaware for its $35 million debtor-in-possession financing, according to a company news release.

The DIP financing is being provided by funds managed by Oaktree Capital Management LP.

"We believe that with final approval of our DIP financing we have the necessary capital to continue to run our operations while we pursue discussions with our creditors and focus on our emergence from bankruptcy," Norbert Woodhams, chief executive officer of Pierre, said in the release.

The DIP financing and cash generated from daily operations will be used to continue to pay vendors and employees, as well as provide operational and financial stability as Pierre proceeds with its financial restructuring, Pierre said.

As previously reported, the DIP facility will mature on the earlier of nine months or the effective date of a plan of reorganization.

Interest will be Libor plus 550 basis points.

Pierre will pay a $10,000-per-month administrative agent fee and a $150,000 work fee.

Pierre, a Cincinnati-based manufacturer, marketer and distributor of differentiated food products, filed for bankruptcy on July 15. Its Chapter 11 case number is 08-11480.

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