As Agriprocessors and the town of Postville stand on the edge of a financial cliff, hope has emerged that the plant will soon find rescue via outside investors, a well-placed employee at the company said this weekend.
Speaking on the condition of anonymity, he said a group of investors toured the plant shortly before the company filed for bankruptcy on Nov. 4, and another group is scheduled to arrive this week.
There is optimism that a deal can be reached within the next month, he said.
The news, which has spread through Postville’s Jewish community, gives hope to people struggling to pay the mortgage and feed large families. They are teachers, rabbis and small businessmen and employees at the plant itself, all of whom depend on Agriprocessors for income.
“They’re hoping something comes in and there’s a new beginning on the horizon,” he said. “There’s a potential for renewal in a very big way because the company gets bought up by a corporate company, and with corporate you have a cash flow we haven’t seen before.”
Despite Agriprocessors’ multitude of legal problems, its sophisticated kosher meat operation, built up over the company’s 20-year existence, remains attractive because its product commands a premium on the market, which results in higher profit margins than non-kosher meat.
Companies from Costco and Sam’s Club have approached the company as recently as a month ago because their product has proved popular, he said.
But with production at a near standstill, those relationships have been put on hold, he said.
Agriprocessors now employs only 200 workers, down from more than 900 before the raid, and has shut down its beef line.
Agriprocessors owes the city of Postville $100,000 in utilities and other payments, a debt that rises every month.
The kosher plant pays the city $334,000 every year for a waste water facility it uses. The city operates a $2.5 million annual budget.
Most of those who relied on Agriprocessors for a living, including a few Jewish families, have decided to leave town.
(Source: WCF Courier)
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6 Responses
as an invester we would never have the union tell us how to run the place.
YUP! apparently it’s the union – mafia that brought them down in the first place.
Does anyone know who these investors are- are they reputable people?
Maybe Empire should buy the plant.
At this point the bankruptcy court would have to approve and that may require the agreement of the creditors.
there are unverified reports that the investors are a consortium of Ghibarese businessmen whose slaughter practices mimic shechita and (le’havdil) halal preparation; the thought is that they could also provide employment to many Ghibarians, where unemployment has hit record highs due to the current global economic downturn. Unfortunately, of course, the plant would no longer be kosher.