Skip to comments.Borden Dairy files for bankruptcy protection
Posted on 01/08/2020 10:01:32 AM PST by Red Badger
Borden is the second giant U.S. dairy company to seek bankruptcy protection as raw milk prices and sales of milk alternatives continue to soar.
Borden, whose mascot, Elsie the Cow, has smiled out at consumers from milk, cheese and butter cartons for more than 80 years, has filed for bankruptcy protection, becoming the second major U.S. dairy company to seek help as milk prices soar and more Americans turn to milk alternatives.
Borden Dairy Co., which is based in Dallas, reported losses of $42.4 million in 2019. In a filing Sunday in U.S. Bankruptcy Court in Delaware, it listed debts between $100 million and $500 million to more than 5,000 creditors.
The company filed under Chapter 11 of the bankruptcy code, allowing it to try to reorganize its debts and remain in business. That's less drastic than filing under Chapter 7, which would have required it to sell off its assets to pay its creditors and potentially go out of business.
Its largest creditors are two of its pension funds, which together are owed more than $33 million, Borden said.
Dean Foods, the country's biggest milk producer, similarly filed for Chapter 11 protection in November. Borden and Dean products made up a little more than one-eighth of all U.S. milk sales last year, according to industry data.
Unlike Dean, which said it intended to sell itself, Borden said it would seek to reorganize its finances to stay in business.
"Borden Dairy is a heritage American brand that has been in business since 1857," Chief Executive Tony Sarsam said in a statement. "We have a very tenured workforce of 3,300 people who live and breathe our values of teamwork and creative problem solving, and I am extremely confident and optimistic about our continued success in the future."
But the U.S. dairy industry has been churned by a double-whammy of economic and lifestyle factors.
Borden said that the price of raw milk has risen 27 percent in the past year and that it's expected to keep rising, partly because more than 2,700 dairy farms have gone out of business since mid-2018.
At the same time, dairy sales have fallen "in conjunction with the rise of oat, nut, soy, and other alternative 'milk' products," which are eating away at both sales of whole milk and its shelf space in stores, Jason Monaco, Borden's chief financial officer, said in an affidavit attached to the bankruptcy filing.
"While milk remains a household item in the United States, people are simply drinking less of it," said Monaco, who cited Agriculture Department data reporting that total U.S. consumption of dairy milk products has fallen by about 6 percent since 2015.
Borden has been known to generations of Americans since it introduced Elsie the Cow on its labels in 1936 many of them on cartons of milk distributed with public school lunches.
Borden claimed that by the 1940s, research showed that more people recognized Elsie than they did the president.
Three other cows that were introduced in the same ad campaign Mrs. Blossom, Bessie and Clara didn't survive the test of time.
A dairy going tits up?
I love milk...always have,always will As for “almond milk” I must say that I absolutely love almonds. But I don’t have the faintest desire to try “almond milk”.and never will.
“Its largest creditors are two of its pension funds, which together are owed more than $33 million, Borden said.”
Pension Benefit Guaranty Corporation - call your office. Taxpayers get haircut.
It ain’t bad.
But it ain’t milk.
Some people can’t drink the real stuff.
But I’m not one of them...................
What udder nonsense!...................
They call it “almond milk” because no one wanted to be selling nut juice.
Same thing they did to Kraft in the 1920’s when Velveeta was cutting into ‘real’ cheese sales................
50’s ad for Borden’s milk. What a different world...
I never saw a balance sheet stating liabilities "somewhere in the vicinity of...". Accounting sure has changed since I got my degree.
Fake milk, fake beef, now fake pork sausage... poor Elsie... I’ll kill rep buying real milk no matter the cost; hope they survive
Common Core Accounting..................
nut juice is milking the system...
My favorite right now is a Coke-backed brand called Fair Life which is filtered cow's milk that is lactose free and tastes like I remember cow milk tasting. I'm lactose intolerant now and don't care for so-called lactose free milk which just adds lactase.
I wonder if he liked gladiator movies?..................
I never thought I would see the day with Borden’s about to go bankrupt. But then, no business is guaranteed to last any given time, certainly not forevermore.
I’m lactose intolerant, and have not drank milk from a glass for over 50 years. I’m one of those people who will pour’fresh water over my corn flakes and bananas.
The cereal flavor is actually improved with water vs milk.
I learned to ignore the puzzled stares of others.
The only other equal-shock would be if Nestles’ Chocolate were to go bankrupt too. That would never happen, right?
Note that Elsie was the cow, Elmer was the Bull.
Recognize the face from Elmer’s Glue-All...? It was originally a Borden product. (*)
(*) Why you’d have the picture of a bull on a bottle of a sticky white unidentified liquid, is best left to the experts...
Lol! Ain’t that the truth?
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