A large Idaho cattle and dairy company expects to fully repay most creditors under a debt restructuring plan recently filed in bankruptcy court.

Under the plan, Millenkamp Cattle proposes to secure a $120 million revolving loan “exit facility” from the Cargill agribusiness company, which would also facilitate its commodity hedging transactions.

Earlier this year, 10 affiliated companies that operate as one enterprise, Millenkamp Cattle, filed for Chapter 11 bankruptcy protection to shield their assets from foreclosure while reorganizing the overall business.

The company was started nearly 30 years ago by founder Bill Millenkamp and his wife, Susie, as a 40-acre “calf-raising operation” near Jerome, Idaho, according to bankruptcy filings.

It’s since grown into a “large vertically integrated agribusiness” run by the Millenkamps and their four children, with subsidiaries involved in raising beef and dairy cattle, as well as custom harvesting and trucking operations.

Millenkamp Cattle estimates that its businesses employ more than 500 workers, span about 20,000 acres and manage roughly 110,000 beef and dairy cattle, which includes feedlot and milking facilities.

The company blames its Chapter 11 bankruptcy on the actions of two lenders, Rabo Agrifinance and Metlife Investment Management, stemming from a $250 million dairy expansion that was completed in 2021.

According to Millenkamp’s bankruptcy filings, Rabo allegedly changed critical lending terms and undervalued steers that were used as collateral for debt, eventually triggering defaults on its loan terms.

Meanwhile, Metlife allegedly broke with past practices and refused to refinance Millenkamp’s debt when it was unable to secure loans from other banks during broader financial troubles in the dairy industry last year, according to bankruptcy documents.

Millenkamp Cattle claims it was “starved” of working capital as part of a deliberate “squeeze” by Rabo, leading to the appointment of a court-appointed receiver to oversee the company’s finances, the filings said.

The company’s problems allegedly continued to deepen under the receiver, who caused a “feeding frenzy” among vendors by failing to honor promised payments, according to Millenkamp.

Millenkamp Cattle claims the receiver’s goal was to sell the company’s assets “without regard to the hundreds of millions of dollars of equity” that its owners had built over nearly three decades.

The company ended up filing for Chapter 11 bankruptcy protection in April but argues its financial problems “were brought on the lending institutions which refused to work cooperatively with each other and the debtors.”

The $120 million credit facility from Cargill is a major component of Millenkamp’s plan to exit bankruptcy, but at this point, the company has received a “term sheet” of loan conditions and the agreement isn’t yet final.

The agreement would also provide the company with an “uncommitted commodities hedging capacity” to help manage the risk of price fluctuations, such as with milk futures.

Millenkamp Cattle anticipates that most debt claims against the company, including $27.5 million unsecured by collateral, will be 100% repaid under the bankruptcy plan, which would become effective on Jan. 1, 2025.

Some of the claims are expected to be paid off by the plan’s effective date, while others would be repaid in installments, such as those of corn silage producers, who’d be repaid on a quarterly basis through December 2026.

Millenkamp’s default interest payments and professional fees owed to Rabo Agrifinance would be forgiven under the plan, leaving the lender with a $91 million claim that would be fully repaid as of the effective date.

Metlife would receive interest-only payments on its $184 million claim for 2½ years after the effective date. After that point, the lender would begin receiving regular principal and interest payments, according to an agreed budget.

Only the $500,000 claim filed by an electric supply company wouldn’t be repaid under the plan, as it’s currently disputed by Millenkamp Cattle.

Millenkamp Cattle owes an estimated $525 million in debt and other liabilities and has more than $640 million in real estate, personal property and other assets, according to bankruptcy documents.

A hearing on the bankruptcy plan is scheduled for Nov. 21 before Chief Bankruptcy Judge Noah Hillen of Twin Falls, Idaho.