Two weeks after announcing it was shutting down its poultry operation, Zacky Farms has filed for Chapter 11 bankruptcy.
The family-run turkey processor’s in the process of closing down factories in Fresno and Stockton, plus Los Angeles corporate offices.
In a Oct. 26 letter to state and local officials, the company stated it was trying to secure financing to keep doors open, but wasn’t successful, resulting in about 500 worker layoffs.
The plants’ operations are closing down in phases with a complete shutdown expected by Jan. 19. News of the bankruptcy comes amid a lawsuit by a former employee who claims the company failed to give advance notice about the layoffs.
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Zacky listed between $50 million to $100 million in debt, according its bankruptcy filing in U.S. District Court in Los Angeles. It also reported between $50 million to $100 million in estimated assets.
The company lists between 200 to 999 creditors. The largest creditor is Western Milling in Goshen, one of the San Joaquin Valley’s leading feed suppliers. Western Milling is owed $8.3 million.
Also owed money is Cuddy Farms in Ontario, Canada, a global leader in turkey eggs and poults. Zacky owes the turkey farmers $1.2 million.
Zacky officials could not be reached for comment Wednesday. Lillian Zacky, whose father-in-law Sam founded the company in 1928 in Los Angeles, is listed in the bankruptcy documents as the company’s managing member.
Lillian Zacky was part of the team that lifted the company out of bankruptcy in 2013. At the time, Zacky’s debt was estimated at $50 million to $100 million. Record high feed prices were taking a toll on the company. It was spending about $1.8 million weekly to feed 2.5 million turkeys and chickens.