Hearthside Food Solutions, contract manufacturer of baked foods, snacks and nutrition bars, has filed for Chapter 11 bankruptcy.

The company announced Nov. 22 that it had entered into a global restructuring support agreement with its key stakeholders. To complete the transactions in its restructuring agreement, Hearthside filed for prearranged Chapter 11 cases in the United States Bankruptcy Court for the Southern District of Texas.

Hearthside reports the restructuring will allow it to eliminate more than $1.9 billion of its debt and secure $200 million of new equity capital at exit.

“With a sustainable capital structure and a significant infusion of new capital to fund our long-term plan, we will be well-equipped to enhance our leadership in the food manufacturing industry as we drive continued innovation and growth,” says Hearthside CEO Darlene Nicosia. “We have taken decisive action across our company to put our past challenges behind us and are encouraged by the improvement we have already seen in our employee engagement, organizational culture and ability to deliver best-in-class, quality products and services that our customers can depend on.”

Hearthside reports it entered this process with support throughout its capital structure, including majorities of its first lien lenders, second lien lenders and unsecured noteholders, as well as its equity holders. 

The company filed customary “First Day Motions” with the Court to facilitate a smooth transition into Chapter 11 and operate without disruption during the process, including continuing to pay employee wages and benefits, maintaining customer programs and honoring obligations to vendors. To fund operations without disruption during the Chapter 11 cases, Hearthside has filed a motion seeking approval of $300 million of debtor-in-possession financing, including $150 million of new money from existing lenders. Following Court approval, the company anticipates this financing will support its operations during the Chapter 11 process.

Hearthside says it intends to emerge from Chapter 11 in the first quarter of 2025. The company’s Interbake Canada operations are not part of the Chapter 11 filing.

Headquartered in Downers Grove, Ill., Hearthside’s production network includes 28 facilities, with a workforce of approximately 12,100. In 2018, Hearthside was acquired by Charlesbank Capital Partners and Partners Group.