Suprema going into liquidation

Dairy Foods,  April, 2002  

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PATERSON, N.J.--Suprema Specialties Inc. is preparing to shutdown after a U.S. Bankruptcy Court judge approved its Chapter 7 bankruptcy filing. The filing allows the 19-year-old company to sell off its assets to pay creditors. In late February, Suprema filed for Chapter 11 bankruptcy reorganization, hoping to continue operating, but those attempts failed last month.

The banks that had lent the company $130 million refused to lend more, ending the company's chances for revival. Suprema, which manufactured and imported gourmet Italian cheeses, has laid off most of the 270 workers it employed at four plants -- in Paterson; Manteca, Calif.; Ogdensburg, N.Y.; and Blackfoot, Idaho.

It sold its products under the Suprema Di Avellino brand and private brands. Among its clients was Sbarro Inc., the chain of shopping-center Italian restaurants. Suprema had sales of $420 million last year.

But in December, two of its financial executives quit, and the Securities and Exchange Commission and the Federal Bureau of Investigation began investigating the company. The company is the target of a number of shareholder lawsuits alleging it artificially inflated its stock price by issuing false financial statements before a public offering of about 4 million shares of stock, which generated more than $48 million in November.

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