California chicken producer gets new $2.3 billion loan from JPMorgan

CAIN, Calif.

— A chicken producer has secured a $2 billion, three-year loan from the investment firm JPMorgan Chase & Co. to help it compete with rising costs in the meat business, the company said Tuesday.

The new loan will allow Calgarian Chicken Corp. to make the transition from a $50 million loan from its parent company, the American Egg Board Inc., to a $1.4 billion loan, the bank said in a statement.

Calgarian, which was founded in 1998 and operates about 300 chicken plants in California, is one of the nation’s largest poultry producers, and has expanded into beef and pork, according to the California Department of Agriculture.

In September, it bought out the American Eggs Board and merged it with a subsidiary called the Calgari Group Inc., which also owns Calgaria Poultry.

JPMorgan also agreed to make $300 million in equity-based payments to the company, including $100 million to Calgaryans’ shareholders.

Calgarian is seeking a $500 million loan, while the bank will give Calgario about $100,000, Calgara said.

California is the third state to get a $300-million loan from a financial institution, joining New York and Texas.