Sunland in Portales closes operations — files bankruptcy

For Terri Lancaster, it started like any other work day at Sunland Inc., a place she said felt like home. Her world was shaken Wednesday morning when she was called into a company-wide meeting and told Sunland’s plants were closing. Citing the impact of a voluntary product recall and a government enforced plant shutdown last year, the Portales peanut processor filed for Chapter 7 bankruptcy Wednesday, according to a company press release. Lancaster was one of the more than 100 employees laid off. Sunland President and CEO Jimmie Shearer declined comment Wednesday afternoon. Chapter 7 means the company shuts down and liquidates its assets. Sunland, a major employer in Roosevelt County where the Valencia peanut is king, was linked to a salmonella outbreak in September 2012 that caused 41 illnesses in 20 states. Sunland recalled more than 100 nut and peanut butter products after the outbreak. It reopened production of its peanut butter plant in March. “Sunland voluntarily recalled all of its products in October 2012, a precautionary measure with enormous financial consequences,” Wednesday’s press release said. “Subsequent administrative actions by the Food and Drug Administration and Sunland’s own commitment to re-double its efforts in the areas of food safety and quality control resulted in the prolonged shutdown of the company’s manufacturing facility to allow for necessary renovations to its facility and the implementation of new food safety procedures.” In May, Sunland received authorization to resume full operations, but “ongoing financial and liquidity challenges made it necessary for the company to file for bankruptcy under Chapter 7 of the Bankruptcy Code,” the press release said. Sunland board member and peanut producer Wayne Baker said the FDA required more than the company could afford to do. “It’s a very unfair deal,” Baker said. “It’s a sad day for Portales, for the community and for peanut growers.” Baker said the 25-year-old company just couldn’t recover from the recall. “It was just kind of sudden. We thought we could pull it together but it was a steeper mountain to climb. We tried to meet the FDA requirements. There was no end,” Baker said. “We were a great company. We’re proud of what we did and proud of what we accomplished.”...more