One of the founding partners in Merit Functional Foods says it is joining forces with a group of investors on a plan to purchase an existing plant protein production facility in early 2025.
Burcon NutraScience Corporation — a B.C.-based publicly-traded company that owns a patented plant protein extraction process — isn’t saying which facility it intends to buy.
The company has specifically not said whether it is aiming to purchase the former Merit plant in Winnipeg (pictured above), which has sat empty since Merit entered receivership in early 2023.
As of last week, Burcon said it was in late-stage negotiations on a facility purchase, with a strategic investor group led by a Burcon board member financing the deal.
The company’s plan would see Burcon become the sole operator of the facility, producing protein products from peas, canola, sunflowers, soy, and hemp.
Burcon says it intends to close the acquisition during the first quarter of 2025, with production coming online in the first half of 2025.
“This is truly a transformative opportunity for Burcon that will accelerate our capital-light strategy,” said Burcon CEO Kip Underwood, in an investor update last week. “With expanded capacity and full control of a protein production facility, we can launch our entire suite of unique protein ingredients to market. We are thrilled about this alliance and deeply appreciate the trust placed in us. This strategic alliance marks a significant step forward in bringing our technologies to market.”
Given the financial challenges faced by many companies over the last few years in the plant protein market, there could be other existing facilities in North America privately available for purchase, but Burcon has a history with the Merit facility.
Merit Functional Foods was founded in 2019 as a joint venture between Burcon and several food industry veterans. The company completed construction on the 94-thousand square foot facility for processing food-grade protein from peas and canola in Winnipeg in 2021, with a projected price tag of $150 million.
Merit entered into receivership in March 2023, owing approximately $95 million to its two main creditors — Export Development Canada (EDC) and Farm Credit Canada (FCC).
As of its last update in March 2024, the court-appointed receiver —PwC— said it had been unable to sell the Merit facility.
