Sale of Merit Functional Foods Plant Finally Materializes After Long Wait

A buyer has emerged for the Merit Functional Foods plant located in Winnipeg, Canada, marking a significant milestone more than two years after the company was placed into receivership.

Background on the Plant

The plant, a state-of-the-art facility specializing in plant protein processing, first opened its doors in 2021. However, the venture faced numerous challenges and went into receivership in March 2023. At that time, former CEO Ryan Bracken cited various factors contributing to the company’s difficulties, including increasing raw material costs, rising interest rates, and a dwindling risk appetite from lenders. He also noted that the commissioning of a novel product took significantly longer than anticipated, hindering operations.

Recent Developments

According to court documents from receiver PricewaterhouseCoopers (PwC), a promising offer was submitted in the summer of 2023. Unfortunately, this offer did not culminate in a definitive asset purchase agreement.

However, on April 29, 2025, PwC announced that it had “entered an asset sale purchase agreement” with an unnamed company registered in Manitoba. This agreement covers the land, buildings, equipment, and other assets associated with the plant. PwC is now seeking court approval to finalize this sale.

Challenges in the Sales Process

In its filing, PwC noted that the proposed sale follows numerous rounds of the sales process. Despite widespread marketing efforts at the outset of the receivership proceedings and multiple expressions of interest, the Merit plant remained unsold for two years.

Financial Implications for Stakeholders

PWC is also petitioning the court for approval to disburse funds to key lenders, which include Farm Credit Canada and Export Development Canada. In a related request, PwC is asking that details regarding the value of the deal be sealed until the transaction is completed.

No Money for Unsecured Creditors

Burcon, a plant protein specialist, held a 31.6% stake in Merit Functional Foods, while Bunge acquired a 25% stake in mid-2020. Additionally, the Canadian government invested approximately C$100 million ($72 million) into the project, including C$9.2 million ($6.7 million) from Protein Industries Canada and C$90 million ($65 million) in debt financing.

According to a report from PwC dated March 6, 2023, Merit owed its lenders C$58.6 million ($42.4 million) and C$36.5 million ($26.4 million), respectively. Unfortunately, PwC indicated that “taking into consideration the anticipated interim distribution, the lenders will suffer a significant shortfall on the amount owed.” Consequently, there will be no funds available for the unsecured creditors.

Future Prospects

In related news, Burcon Nutrascience—which attempted to secure a deal for the Merit plant shortly after receivership was announced—has recently unveiled plans to commence commercial-scale production of various plant proteins at a new facility in Galesburg, Illinois.