Pasta Giant in Chapter 11 Status
Byline: Marguerite Higgins, THE WASHINGTON TIMES
The nation's largest pasta manufacturer yesterday filed for bankruptcy as more food companies struggling against the low-carbohydrate diet craze roll out products to boost sluggish sales.
New World Pasta Co., a Harrisburg, Pa., company that makes San Giorgio, Creamette and Ronzoni dry pastas, filed for Chapter 11 bankruptcy protection at the U.S. Bankruptcy Court for the Middle District of Pennsylvania.
The company said low-carb diets, $450 million in debt and internal accounting problems led to the "voluntary decision" to file bankruptcy.
The company, with plants in Winchester, Va.; Fresno, Calif.; Omaha, Neb.; St. Louis; and Louisville, Ky., has not posted a profit since 2001.
The most recent estimate of unaudited results reported a loss of $14 million in 2003, before interest, taxes, depreciation and amortization, on sales of $450 million, said Cary Metz, vice president and general counsel.
In the most recent financial quarter, dry pasta consumption in the United States fell 7 percent from a year earlier, according to a recent study by research firm AC Nielsen. …