Low-carb king Atkins files Chapter 11

gldstwmn · #1 07-31-2005, 11:56 PM

http://www.cnn.com/2005/US/07/31/atk....ap/index.html

Company owes $300 million in outstanding principal and interest

NEW YORK (AP) -- Atkins Nutritionals Inc., the company that promoted low-carb eating into a national diet craze, filed for bankruptcy court protection Sunday, a company spokesman said.

Atkins has been hurt by waning popularity of its namesake diet, 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 virtual cottage industry of low-carb regimens, but also drew criticism from experts for its focus on fatty foods and low fruit and vegetable consumption.

A hearing on the prearranged, Chapter 11 filing was scheduled for Monday in U.S. Bankruptcy Court, spokesman Richard Rothstein said. The privately held company, founded in 1989 by 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.

Atkins owes $300 million in outstanding principal and interest, Rothstein said.

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 CEO 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 heath and wellness."

After it leaves bankruptcy, the Ronkonkoma, New York-based company will focus on its nutrition bars and shakes, Rodriguez said in a statement.

Private equity firm Parthenon Capital LLC acquired a majority stake in Atkins, in October 2003.

Goldman Sachs Capital Partners owns a smaller stake in the company, as does the estate of Robert Atkins, who died in 2003 from injuries he suffered in a fall.

irishgrl · #2 08-01-2005, 08:18 AM

Quote:

Company owes $300 million in outstanding principal and interest

they shoulda trimmed the fat in their expenditures (ar ar)

I am proud to say I never bought into this cah ray ZEE diet. (or any "diet" for that matter)

DrummerDeanna · #3 08-01-2005, 09:29 AM

NPR is actually doing a story on this tonight actually...and they've called and now I'm on my way out to get some "man on the street" interviews about the Atkins Diet

xxxmx · #4 08-01-2005, 06:51 PM

my mom lost 85 pounds after following the diet for over a year. she was really hardcore about it but now... not so much. she hasn't gained all of the weight back, probably only twenty or so pounds, but i think she finally realized that you simply cannot cut out that many foods. she's a nurse and i can't believe she went along with it for as long as she did. like ten years from now, i bet there'll be all kinds of health problems cropping up as a result of atkins.

littlecricket2 · #5 08-01-2005, 07:19 PM

I look at this as poetic justice. When I was in high school and we were first learning about how your body burns fat, my aerobics teacher taught us that we burn carbs first, then fat after we've been working out for a certain amount of time--so if you don't work out enough, you're not going to burn already existing fat.

I remember thinking, "hmmm...what if you didn't eat any carbs and therefore didn't have any to burn up? Then you'd have to start burning fat right away!" But then I quickly talked myself out of that, realizing that it was a bad idea and would not lead to a healthy, balanced lifestyle. Fast-forward about 7 years and this DOCTOR touts the diet and makes millions. Feh. His empire deserves to go down--it's a bad idea and I could have told him that when I was 16, FOR FREE.

Good riddance to any fad diet!!!

SuzeQuze · #6 08-02-2005, 07:03 AM

It never ceases to amaze me how CEOs can mismanage their companies so badly. This was one of the most popular diets ever and they are bankrupt? Did they believe they could be the biggest diet forever? What a waste, I wish they would just close their doors because I agree that the diet is not healthy. They are only helping people lose weight in the short term.

I knew someone who touted that diet as the best thing ever but eventually he had to cave and eat bread. He gained back all the weight he lost. Despite Stevie's claim that Atkins was a god among men, I think he may have, perhaps inadvertently, done more harm than good in terms of long term weight management.

bikerchic · #7 08-02-2005, 02:52 PM

What about "The South Beach Diet", has anyone tried that? It seem's alittle healthier.

amber · #8 08-02-2005, 02:57 PM

Quote:

Originally Posted by bikerchic

What about "The South Beach Diet", has anyone tried that? It seem's alittle healthier.

It's a lot healthier, in fact, there's really nothing non healthy about it at all.

LiquidBlue5000 · #9 08-02-2005, 07:27 PM

Quote:

Originally Posted by SuzeQuze

It never ceases to amaze me how CEOs can mismanage their companies so badly. This was one of the most popular diets ever and they are bankrupt? Did they believe they could be the biggest diet forever? What a waste, I wish they would just close their doors because I agree that the diet is not healthy. They are only helping people lose weight in the short term.

I knew someone who touted that diet as the best thing ever but eventually he had to cave and eat bread. He gained back all the weight he lost. Despite Stevie's claim that Atkins was a god among men, I think he may have, perhaps inadvertently, done more harm than good in terms of long term weight management.

As a former employee of "Atkins Nutritionals", i feel i can speak firsthand on this issue

The company itself made MOST of its money off their food order catalog.. i was one of the reps working in the call center at the time and the prices that they were charging for these "low carb dishes" were outrageous... I knew a year and a half ago they were gonna be put out of business when I saw all these major brands putting out their own low-carb foods... in 2001, "Atkins Nutritionals" had acquired this enormous facility near my house, which included the offices, the warehouse, and the store front for their products... They payed their employees very very well and offered many many perks for being employed by them (75% employee discount

)

but they were completely running a business beyond their means by the time 2004 rolled around... it was only a matter of time before they filed chapter 11... i'm surprised it didnt happen sooner...