|Atkins Diet Firm on the Brink of Liquidation
March 16, 2005
by Graham Hiscott
The company behind Atkins diet products is preparing to pull the plug on its UK operation, it emerged today.
Administrators are expected to be appointed either today or tomorrow after the business was hit by disappointing sales.
The decision could leave firms dealing with Atkins Nutritionals UK, including manufacturers of its products, being owed huge sums of money for unpaid bills.
Jeremy Willmont, from chartered accountants Moore Stephens, is expected to be appointed administrator to hopefully find a buyer for the business.
"They are taking steps to place the company into liquidation," he confirmed.
"They are in the process of making an approach to the High Court for an administrator to be appointed.
"I am not sure whether that will happen today or not but everyone is hoping it will be."
No-one at the company's head office in Slough, Berkshire, was initially available for comment.
"Product sales have been bad for some time but they have been putting a bit of a spin on it," said a member of staff.
"But it has caught up with them now and they have gone belly-up in the UK and Europe.
"The trouble was they tried to grow too quickly but their sales never reached the levels they expected and competitors have done a much better job.
"They asked the parent company in the US to cover their debts but they said they can't.
"We are more than a little bit angry because we have worked with them for two years and thought we had a close relationship.
"There will be lots of other people affected as well.
"Many of their manufacturers and suppliers will be owed hundreds of thousands of pounds."
Atkins Nutritionals sells more than 20 products for followers of the controversial Atkins eating plan.
There have been reports that interest in the high-protein, low-carbohydrate diet has waned in recent months.
A report published by market analysts Mintel in October last year highlighted the high drop out rate of low-carb diets.
Just 2.8% of those questioned by Mintel were currently on a low-carbohydrate regime, such as the Atkins Diet.
Another 10% said they had followed one of the diets but had given up, with only 1% willing to try it again.
James McCoy, senior consumer analyst at Mintel, said: "While many consumers may have been attracted to the promise of rapid and significant weight loss, they appear to have found it a difficult diet to stick to in the long-term.
"A number of dieters have not found this diet worked for them, it may be a question that they did not fully understand or trust the diet."
Tamara Richardson, senior vice president international for Atkins Nutritionals, claimed the decision to bring in administrators did not mean the end of the company.
"We owe people and people owe us," she said. "We felt the decision we have taken is the responsible thing to do.
"We hope there may be a way through this so that the brand will continue to be available to consumers."
Ms Richardson, who confirmed the UK arm had amassed big debts, said it had faced tough competition from rival low-carb brands.
"Even with the market share we have, we have still been hit by the competition that entered the UK market, particularly own-brand products."