WILMINGTON, Del.- A South Korean company said it has reached a deal to buy a bankrupt Delmarva poultry company.
Harim Group said a federal bankruptcy judge in Delaware indicated he would approve the sale of Allen Family Foods during a hearing Wednesday, the company said in an email statement. The deal is expected to cost approximately $48 million, plus the value of Allen's inventory.
Allen's currently employs about 2,400 people in Delaware, Maryland and North Carolina. The company filed for bankruptcy in early June.
Earlier this week, Mountaire Farms announced it was outbid in its attempts to acquire Allen.
Harim said it plans to operate existing Allen facilities with many current Allen employees. Employees said layoffs are planned. Numerous workers told WBOC that management posted a list on Monday; employees whose names are not on the list were told their last day of work will be Friday.
In the statement, Harim said it plans to continue business relationships with chicken growers who currently provide chickens to Allen.
"We believe that Allen's assets, Allen's established brand name among customers and contract farmers and its long term history in the region, make the transaction a great opportunity for Harim and the local communities," Allen Chairman Charles "Chick" Allen said in a statement. "With Harim's ability to leverage the growing Asian market and its healthy balance sheet, the future is very bright."
Harim Group dominates the Korean chicken market with approximately 40 percent market share, according to a company profile. The group has 20 companies in Korea and 10 throughout Asia. Harim Group's sales total approximately $3.5 billion and the company employs about 6,300 people excluding those outside of Korea, according to the profile.
"This transaction will allow Harim to enter the global food market in the U.S. and to build on Allen's rich tradition and history as a leader in the industry," said Hong Kuk Kim, chairman of the Harim Group.
The transaction is expected to be completed in the upcoming weeks.
