Merisant, owner of the Equal sweetener, seeks bankruptcy protection
Sweetener manufacturer Merisant has filed for Chapter 11 bankruptcy in the US as they seek to restructure their balance sheet in order to free up funds for supporting a sweetener derived from the stevia plant.
The company, best known for their Equal sweetener, has come under heightened pressure in the industry as other sweeteners – particularly Tate & Lyle’s Splenda – begin to eat away at their market share. They have struggled to meet debt obligations as the financial turmoil has made it more difficult to obtain access to credit.
“During the last four years, we took aggressive measures that succeeded in cutting costs and making Merisant more efficient as well as building a platform for future growth,” Paul Block, Chairman and CEO of Merisant, said. “Yet despite these efforts, recent turmoil in the financial and credit markets has made it impossible for us to refinance our debt, without which we cannot complete the restructuring of our business.”
“Restructuring our balance sheet is the best way for us to maximise the success of our company and its many products. We expect that Merisant will emerge from this process stronger and better able to compete.”
The news comes weeks after the Food and Drug Administration (FDA) gave approval for a stevia-based sweetener made by PepsiCo in conjunction with Whole Earth Sweetener Company (a wholly owned subsidiary of Merisant). Merisant is confident that the sweetener, PureVia, will provide strong sales in coming years as the buzz around the zero-calorie sweetener continues to escalate.
“During this restructuring, we will continue to support our current brands and launch PureVia, our exciting all-natural, zero-calorie sweetener, in partnership with PepsiCo, as well as advance our plans to introduce natural sweeteners in other markets,” Mr Block added. “We’ve seen tremendous interest in PureVia in response to (the approval from the FDA).”
The daily operations of their global businesses will not be impacted by the filing for bankruptcy.
“Simply put, this balance sheet restructuring is about reducing the company’s debt, not disposing assets, reducing the workforce or reconfiguring our operations,” Mr Block advised.