Seneca Foods Hopes To Acquire Allens Out Of Bankruptcy

Siloam Springs-based Allens Foods could soon be gobbled up by Seneca Foods Corporation as the New York-based fruit and vegetable manufacturer entered into an asset purchase agreement for $148 million on Tuesday (Dec. 17).

The deal would give Seneca essentially all of the operating assets of Allens Foods, subject to a working capital adjustment, plus the assumption of certain liabilities, according to the release.

The transaction would take place through a court-supervised process under Section 363 of the U.S. Bankruptcy Code and is subject to an auction and bankruptcy court approval.

On Oct. 28, Allens filed a petition for relief under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Western District of Arkansas. The purchase agreement will serve as the “stalking-horse bid” in the auction process.

Allens will be seeking bankruptcy court approval of Seneca’s asset purchase agreement as the stalking horse bid and certain bid procedures at a hearing in the near future. The preliminary hearing for the bankruptcy was postponed earlier this week until Jan. 17.

If the Seneca is ultimately successful in its acquisition of these assets, they will fit with its long-term growth objective to expand the line of canned vegetable offerings to include sweet potatoes, southern vegetables, and broaden its offerings of dry beans and spinach.

Miller Buckfire & Co., LLC, a Stifel Company, is serving as the Seneca’s investment banker. Jaeckle Fleischmann & Mugel, LLP and Wright, Lindsey & Jennings LLP are serving as legal advisors.