Official Atkins statement, copied from a message board on the Atkins site:
Atkins Enters Final Phase of Restructuring
The company emphasized that the filing will not impact day-to-day operations. Commences Pre-arranged Chapter 11; receives approval for $25 million debtor-in-possession financing: day-to-day operations continue
New York, NY, August 1, 2005 - Atkins Nutritionals, Inc. (ANI) announced today that it has commenced reorganization proceedings under Chapter 11 of the United States Bankruptcy Code, a move that marks the final step in its previously announced effort to reorganize the business. In connection with the filing, the company confirmed it has reached agreement with the overwhelming majority of its lenders on a pre-arranged plan to restructure its debt and, as a result, will be seeking the Bankruptcy Court's approval of its Plan of Reorganization, which will be filed shortly. The lenders will receive the equity of the company in exchange for a substantial reduction of its outstanding debt.
"We are pleased to have reached this milestone with such strong support from our Board of Directors, equity sponsors and lender group," said Mark S. Rodriguez, President and Chief Executive Officer of ANI. "In the past year we have adjusted our organization to accommodate a smaller business and have begun to position the Atkins brand more broadly for consumers who are concerned about health and wellness."
"I will focus its energy on driving profitable growth within its core nutrition bar and shake portfolio," said Rodriguez. Atkins is one of the leaders in the weight control and nutrition category in the United States and Canada with products available to consumers in over 30,000 stores in North America.
"I am confident in our future," concludes Rodriguez. "We expect to proceed quickly and will emerge from these proceedings with a significantly improved balance sheet and greater operating flexibility."
The company emphasized that the filing will not impact day-to-day operations.