Two years ago, Lonnie "Bo" Pilgrim fulfilled what he believed to be a mission from God: He bought rival Gold Kist Inc. for $1.1 billion and turned his Pilgrim's Pride Corp. into the world's largest chicken company.

Today, the 80-year-old Mr. Pilgrim is watching his Texas-based poultry empire struggle to stay afloat. Hammered by rising prices for feed, falling prices for chicken and an increasingly untenable debt load, Pilgrim's Pride saw a $53 million fiscal-third-quarter loss. It expects to report a "significant...