Food Business News - Aug 09, 2005 - (Page 1)

FoodBusinessNews August 9, 2005 NEWS, MARKETS AND ANALYSIS FOR THE FOOD PROCESSING INDUSTRY Policinski to lead Land O'Lakes 8 What do women want? 24 I.F.T. post-show wrap-up 26 MARKET WATCH Atkins files for Chapter 11 bankruptcy RONKONKOMA, N.Y. - Atkins Nutritionals Inc. filed for Chapter 11 bankruptcy, saying it will shift its focus from low-carbohydrate diet products to nutrition bars and shakes. The move marks the company's final step in its previously announced effort to reorganize the business. The privately held company, founded in 1989 by the late nutrition guru Dr. Robert C. Atkins, said it had reached an agreement with the majority of its lenders to give them equity in exchange for lowered debt. The company, which sells Atkins-brand nutrition bars, shakes and candy as well as offering low-carbohydrate diet information, has been hurt by waning popularity of its namesake approach, which focuses on eliminating carbohydrates such as bread and pasta to shed weight. The diet became one of the most popular in U.S. history, spawning a plethora of lowcarb regimens - but also drew criticism from experts for its focus on fatty foods and low fruit and vegetable consumption. Atkins Nutritionals owes $300 million in outstanding principal and interest, said Richard Rothstein, a company spokesman. The company said it had received $25 million in financing to operate during the bankruptcy proceedings, which it said would not affect day-to-day operations. President and chief executive officer Mark S. Rodriguez said the company has in the past year "adjusted our organization to accommodate a smaller business" and will promote its brands "more broadly for consumers who are concerned about health and wellness." After it leaves bankruptcy, the company will focus on its nutrition bars and shakes, Mr. Rodriguez said. "I am confident in our future," he said. "We expect to proceed quickly and will Continued on Page 9 To the next level Product innovation lifts The Hershey Co. Almond crop is projected to be the smallest since 2001. HERSHEY, PA. - Even as the company hits its stride from initiatives undertaken earlier in the decade and enjoys solid financial growth, The Hershey Co. is setting the stage for what the company believes will be the next successful chapter in a long, storied history. Concurrent with the release of financial results for the second quarter ended July 3, Hershey announced a blitz of product innovation for the months ahead and a $145 million restructuring program. While the improved financial results at Hershey may be traced to a number of steps taken by the company in recent years, credit for the improvement goes to Richard H. Lenny, Hershey chairman, president and chief executive officer, said Andrew Lazar, managing director of Lehman Brothers in New York. "Other than Wrigley, no one in the food industry is putting up this kind of growth," Mr. Lazar said. "It's high quality, because it's Continued on Page 19

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Food Business News - Aug 09, 2005