WINNIPEG, MANITOBA — Ingredient supplier Merit Functional Foods has been placed in receivership by a Canadian court. In a March 1 post on LinkedIn, Ryan Bracken, co-chief executive officer, wrote, “this means the end of Merit as it stands today.”
He added that while the company has had some successes, it could not get to a level of cash flow needed to operate the business profitably.
“The current external environment is tougher now than ever before on startups.”
Burcon Nutrascience Corp., Vancouver, British Columbia, which owns a 31.6% stake in Merit Functional Foods, said the Merit lenders Export Development of Canada and Farm Credit Canada had filed an application with the Court of King’s Bench of Manitoba for the appointment of a receiver.
In Canada, receivership means a third party is appointed by a court to take control of an asset, supervise liquidation proceedings and remit the proceeds according to the priorities established by law.
Founded in 2019, Merit Functional Foods is a processor of pea and canola protein into a variety of ingredients for such applications as dairy alternatives, meat alternatives, bars and ready-to-drink beverages. In February 2021, the company opened a 94,000-square-foot processing plant in Winnipeg, Manitoba.
Other investors in the company included Bunge Ltd., St. Louis. In 2020 the company invested $30 million for a minority stake in the company.