The North American Bison Co-operative, which has been buried under debt the past few years, should know by late June whether creditors will accept its plan for a financial overhaul.
When the co-op filed for bankruptcy protection last November, its debts totalled $24.5 million US. Much of that was for deferred payments to its members, who include bison producers in Canada and the United States.
Dieter Pape, the co-op’s chief executive officer, said last week that a disclosure statement could be mailed to creditors in early May.
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That statement would reveal to creditors the information they need when deciding whether to vote for the co-op’s restructuring plan.
If the disclosure statement is approved by the courts for release to creditors in early May, it could then be mailed. Creditors would have 45 days to vote on the co-op’s reorganization plans, Pape said.
The co-op is obliged by United States law to repay 100 percent of the debt owed to secured creditors. But unsecured creditors could see a proposal to repay only a portion of the debt owed to them.
Under its application for bankruptcy protection last fall, the co-op reported owing $22 million in deferred payments to its members. The deferral accumulated over the past few years as bison production expanded but demand for the meat did not keep pace.
Pape said the goal is to repay producers the money owed them for delivering bison to the co-op’s slaughter plant at New Rockford, North Dakota.
“The proposal is they would be paid a portion of the profits on a continuing basis from the co-op.
“It’s a lot of dollars that are out there. (The deferred payments) were accumulated over a number of years and it will take time to repay those.”
The co-op is processing 500-700 head of bison per month, according to Pape, who noted new bison meat markets have developed among national and international food retailers.
“We’re right on track and where we wanted to be. We’re very, very happy with where we’re at.”
The bison co-op has about 330 members. A third of them are Canadian.
Under North Dakota’s law for co-operatives, the co-op has to reserve 20 percent of its profits as patronage to members delivering to its plant.
Canadian members have not been able to export to the New Rockford plant due to BSE closing the border two years ago. Until bison exports resume, Canadian members may not see all the benefits their American counterparts do.
