US milk producer Borden Dairy files for bankruptcy

US-based Borden Dairy, along with some of its affiliates, has initiated voluntary reorganisation proceedings in the District of Delaware under Chapter 11 of the Bankruptcy Code.

Established in 1857, Borden has been producing more than 35 dairy products. It is said to be the first US company to use glass milk bottles, as well as develop a patent for the process of condensing milk.

Headquartered in Dallas, Borden currently operates 12 milk processing plants and almost 100 branches across the US.

Borden CEO Tony Sarsam said: “Borden is EBITDA-positive and growing but we must achieve a more viable capital structure.

“This reorganisation will strengthen our position for future prosperity. Over the past 163 years, we have earned the distinction of being one of the most well-recognised and reputable national brands.

“We remain committed to ‘The Borden Difference,’ which is our promise to be the most service-oriented dairy Company that puts people first. We will continue serving our customers, employees and other stakeholders and operating business as usual throughout this process.”

By filing for bankruptcy, Borden intends to make use of the court process to financially restructure the company to reduce its debt.

The dairy firm added that intends to continue its operations under the court’s supervision, continuing to offer its products to consumers.

Sarsam added: “Despite our numerous achievements during the past 18 months, the company continues to be impacted by the rising cost of raw milk and market challenges facing the dairy industry.”

The company also intends to obtain court approval to work closely with creditors, customers and employees to identify value-maximising restructuring plans, which could benefit all stakeholders.