MarketsFarm — After Manitoba-based plant protein processor Merit Functional Foods went into receivership last Wednesday, Manitoba Pulse and Soybean Growers (MPSG) executive director Daryl Domitruk said it is not a microcosm of the province’s pulse industry.
Domitruk said MPSG learned about Merit’s financial situation through the media. He also added that some Manitoba pea growers delivered contracts to Merit Foods as it had a smaller acreage requirement — 10,000 acres, compared to Roquette’s 120,000.
“The potential loss of that outlet is important for them,” he said. “But in the grand scheme, we’re very satisfied that we’ll recover.”
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Vancouver-based protein firm Burcon NutraScience, which has a 31.6 per cent stake in Merit, said Friday it “intends to submit a formal proposal to acquire” the Merit business.
Domitruk is hopeful a buyer can be found, but time is of the essence.
“Any requirement for peas that any buyer would have, they would need to know pretty quickly because farmers will be making planting decisions,” he said.
Domitruk added that the pea-processing sector in Manitoba would survive Merit’s potential absence as there are other companies doing business in the province.
“In the long term, we still think there’s value in the industry. It’s a setback to lose any processor. We were hoping that rather than losing processors, we were on the front end of an overall trend to have more processing done in the province. We still think that’s possible, so we’re regarding it as a temporary setback for now.”
PricewaterhouseCoopers (PwC) announced last Wednesday it’s now the court-approved receiver for Merit and the numbered company that owns Merit’s processing plant and property in Winnipeg’s CentrePort industrial park.
Federal lenders Export Development Canada (EDC) and Farm Credit Canada (FCC) filed Feb. 24 for the receivership order, claiming Merit owes them principal and interest totalling $95 million.
Burcon CEO Kip Underwood wrote in a Feb. 8 letter to stakeholders that while the company had seen improved production and sales performance over the previous six months, “the overall financial performance of the business has fallen short of expectations and led to the current cash flow concerns.”
— Adam Peleshaty reports for MarketsFarm from Stonewall, Man. Includes files from Glacier FarmMedia Network staff.
