Bankrupt Agriprocessors Slated for Sale
The troubled kosher meat company Agriprocessors is set to be sold to a new Jewish owner.
Agriprocessors has been owned by the Brooklyn-based Rubashkin family, but it went bankrupt last fall after a massive immigration raid at the company’s Postville, Iowa, slaughterhouse.
The company’s bankruptcy trustee, Joseph Sarachek, recommended on June 23 that Agriprocessors be sold to SHF Industries, a newly formed company owned by Hershey Friedman, a Montreal businessman. Sarachek said that Friedman has experience in the plastics industry but not in the meat industry. Other than that, Sarachek said, “I don’t know much about him.”
Sarachek said that Friedman will likely maintain Agriprocessors as a kosher meat company. Rabbi Menachem Genack, the head of the largest kosher certifying agency, O.U. Kosher, said that he has had discussions about maintaining O.U. supervision for the company’s meat, but he has not learned much in the way of specifics about Friedman.
“What I’ve heard about him is that he’s a reputable, wealthy businessman — and a very observant Jew,” Genack said, “but I’ve never met him.”
Agriprocessors was forced into bankruptcy after it defaulted on a $35 million loan a few months after the immigration raid. Since then, Friedman purchased some of the company’s debt. He is now set to use $8.5 million of the debt he owns to cover the purchase of the company’s assets. The figure is staggeringly low, given that Agriprocessors’ annual sales a few years back were estimated in government documents to be $250 million; at that time, Agriprocessors was the country’s largest kosher meat company, serving as the only source of kosher meat in many parts of the United States.
Currently, Agriprocessors main slaughterhouse in Postville is operating at about 30% of peak capacity, slaughtering poultry and processing beef that the company slaughters in South America. The process of selling the company has gone slowly; an auction in May failed to produce a winning bid. If the U.S. attorney and federal judge overseeing the bankruptcy approve the sale, Friedman could take immediate control of the company.
Contact Nathaniel Popper at [email protected].
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