Gardenburger Inc., the former company credited with taking veggie burgers into the mainstream, has filed for Chapter 11 bankruptcy protection.
In a statement Friday, company officials announced Gardenburger would stay in business, but would become privately held. Officials declined to name the new owner, saying details of the proposed reorganization would be announced next week.
The move comes just two years after the company relocated its manufacturing hub to Clearfield, Utah, and its headquarters to California.
"It's a very sad story," said Paul Wenner, founder and former president of Gardenburger. "It started out as a wonderful growth story."
Wenner said he was worth more than $88 million before Gardenburger's stock crashed. He now lives in Maui and serves on the company's board, but is no longer an employee.
Company officials said in the statement that they had decided to privatize as part of an effort "to make Gardenburger a simpler and more efficient vegetarian foods company."
The company reached its zenith in 1997, when annual sales topped $100 million. By 2004, sales had plummeted.
The company gambled heavily on advertising, spending $1.7 million for ads shown during the final episode of "Seinfeld" — all to no avail.
Competition also took a bite out of Gardenburger's patty. In 1997, Kraft Foods bought Bocca Burger and Kellogg Co. bought Morning Star Farms, two competing brands.
In the vegetarian food community, many were saddened by the news.
"Gardenburger was a historic company — I'm sad to see them struggle," said Seth Tibbot, the majority owner and president of Turtle Island Foods in Hood River, which makes the Tofurky brand.