PITTSBURG, Texas (AP) -- Poultry processor Pilgrim's Pride Corp., which filed for bankruptcy protection earlier this week, said Wednesday a Texas court approved an agreement allowing the company to access $365 million in financing.
The company said the U.S. Bankruptcy Court for the Northern District of Texas granted interim approval for Pilgrim's Pride to access the financing, which is part of the company's $450 million debtor-in-possession financing facility.
Debtor-in-possession financing allows a company to continue operating during bankruptcy proceedings. The financing was arranged by Bank of Montreal.
Pilgrim's Pride said the financing, combined with cash from ongoing operations, will allow it to meet its business obligations like paying wages and making payments to vendors.
The company also said it received court approval to pay employee wages and health benefits that it owed before filing for bankruptcy on Monday and will continue to honor all of its current customer policies, including coupon programs, product replacement and customer refunds.
The company's final debtor-in-possession hearing is scheduled for Dec. 17.
Pilgrim's Pride filed for Chapter 11 bankruptcy protection on Monday. The company had been unable to fulfill its financial obligations and had a big interest payment due this week.
The company has been saddled with a large debt load from its $1.3 billion acquisition of rival Gold Kist Inc. in 2007. The processor has also been hit by an oversupply of chicken and high animal feed costs.