Golden Guernsey is bankrupt

Hoard's Dairyman: 

Golden Guernsey is bankrupt

Date: 
Wed, 01/09/2013

The 83-year-old Milwaukee plant closed its doors Saturday. Golden Guernsey’s owner has filed for Chapter 7 bankruptcy protection.

by Lucas Sjostrom, Hoard’s Dairyman Associate Editor

As we reported on Monday (Golden Guernsey plant closed unexpectedly), the Golden Guernsey plant in Waukesha, Wis., closed its doors unexpectedly over the weekend. According to reports from the Milwaukee Journal Sentinel, some workers learned of the closings Friday evening, while others learned about it when they showed up to locked doors on Saturday. It may be the end of an era but the beginning of a new chapter – Chapter 7 that is.

In a release Tuesday night, OpenGate Capital, Golden Guernsey’s owner since a forced Department of Justice divestment from Dean Foods in September 2011, revealed that the company would be filing for Chapter 7 bankruptcy protection in a Delaware court. Sales were up 20 percent since the plant was acquired, according to the release. But, evidently, the higher sales did not make up for additional costs.

The Journal Sentinel also reported that Foremost Farms is one of the suppliers to the plant. Chapter 7 bankruptcy represents a liquidation of assets, not like the Chapter 9 and 11 processes that plan for eventual repayment and reorganization.

We called Foremost’s corporate offices this morning for insight on the situation. Joan Behr, Foremost Farms' Corporate Communications manager, confirmed that Foremost was indeed a supplier but did not know what percentage of the plant's supply came from the cooperative or if they were Golden Guernsey's exclusive supplier. When I asked about Foremost considering purchase of the plant down the road, she said the cooperative did not have a response at this time.

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