New owner preserves 154 jobs at bankrupt maker of Latino cheeses in Modesto
A new owner emerged Wednesday at Rizo-Lopez Foods, a Modesto cheesemaker that had dealt with deadly bacteria outbreaks.
The Yosemite Boulevard plant will continue to employ 154 people after its bankruptcy sale to Valley Milk LLC. The buyer already has a powdered milk business in Turlock and got the Modesto plant for about $35 million, a court filing said.
Rizo-Lopez produces Mexican and Central American cheeses and sour creams under the Tio Francisco brand.
Valley Milk got a 60% share in the plant, paying about $14.2 million in cash and assuming about $20.8 million in debt. The remaining share will be retained by the founding Rizo family, which will help guide the operation into the future.
A news release Wednesday said the Modesto plant is under a new corporate entity called Francisco Foods LLC.
“Partnering with Valley Milk gives us the foundation to come back stronger,” co-founder Edwin Rizo said, “and I am confident that our customers and partners will see and feel that difference from day one.”
Why did Rizo-Lopez recall its products?
Rizo-Lopez recalled all of its products from stores and homes in February 2024. They had been linked to 26 listeria infections since 2014 by the U.S. Centers for Disease Control and Prevention. The agency said two people died and 23 were hospitalized in 11 states.
“This is the first time any product that we manufacture has been linked to a food-borne illness,” Edwin Rizo said at the time. “As soon as we were aware of this, we made the immediate decision to stop production and voluntarily recall all our products manufactured in our facility.”
A federal court ordered the plant to close in September 2024. It reopened about 11 months later after complying with food-safety standards.
Rizo-Lopez Foods began with cheese sales in 1991 and became a manufacturer in 1996. It used a small building in downtown Riverbank until its 2012 move to much larger quarters in the Beard Industrial District.
The plant turns out cheeses such as cojita, fresco, Oaxaca and panela. The sour creams include crema Mexicana and crema Centroamericana.
The products have helped meet the booming demand for Latino cuisine around the United States. About half of Stanislaus County’s massive milk volume goes to cheeses of various types.
When did Turlock dairy business start?
Valley Milk launched in 2018 and now employs about 75 people. It dehydrates fresh milk for use by other food manufacturers.
“This partnership,” CEO Damien Caton said in the news release, “is a natural extension of Valley Milk’s commitment to the Central Valley community and the dairy industry.”
Rizo-Lopez filed for bankruptcy in September 2025 but kept the plant running. The federal bankruptcy court in Sacramento approved the sale to Valley Milk on April 1.
The filing was under a section of bankruptcy law that allows debtors to reorganize rather than shut down. Rizo-Lopez’s attorneys noted this in a March 11 filing: “Most importantly, it preserves the debtor’s business as a going concern (and) saves a vital local enterprise and the livelihoods of its dedicated employees.”
The Beard district has about two dozen companies, most of them food and drink processors. It just lost the Del Monte Foods fruit cannery, which employed about 600 people year-round and 1,200 more during harvest. Unlike Rizo-Lopez, it could not find a new operator in a bankruptcy auction.
This story was originally published April 9, 2026 at 12:43 PM.
