In their effort to consolidate jobs and streamline processes, Pilgrim’s Pride which was purchased by JBS USA during Chapter 11 bankruptcy, implemented 230 corporate and administrative job losses, including 160 job losses in East Texas.
“We operate a lean corporate structure,” said spokesman Chandler Keys. “One of the main goals is to make sure we don’t have layers of bureaucracy.”
While more job losses aren’t currently planned, Keys did not rule out additional job losses in the future. As part of Pilgrim’s Pride’s Chapter 11 bankruptcy restructuring, the company has agreed to merge with the JBS, a Brazilian beef giant and become a leaner and hopefully more profitable operation. Unfortunately for Pilgrim’s workers, that process may include a post-bankruptcy wave of job losses.
But despite the job losses, Pilgrim’s Pride should probably consider itself lucky to survive because when they first filed Chapter 11 bankruptcy, they were unable to find any major U.S. banks to fund its bankruptcy restructuring. This is why they are now merging with the Brazilian beef processor who purchased a majority share in the company during bankruptcy. Before the holidays, Pilgrim’s owner lamented the fact that U.S. banks who received a taxpayer bailout did not offer any loans to the company during their Chapter 11 bankruptcy and said the Pilgrim’s was “forced” to find funding abroad.
But as 2010 begins and the credit crunch continues, we could see more U.S. companies file Chapter 11 bankruptcy and use foreign banks so they can survive bankruptcy restructuring and emerge a viable entity.