MercoPress. South Atlantic News Agency

US main ground beef processor files for bankruptcy following hamburger’ ‘pink slime’ controversy

Pink slime or ammonia hydroxide allegedly is used to kill pathogens in ground beef

US ground beef processor AFA Foods filed for bankruptcy protection this week and said it plans to sell some or all of its assets, citing the impact of media coverage related to a meat filler critics have dubbed “pink slime.”

Meat processors have faced a backlash over the use of an ammonia-hydroxide-treated beef filler they call “finely textured beef.” Food activists have campaigned to have it banned arguing the product was unappetizing, but supporters say the product is safe to eat.

AFA is one of the largest ground beef processors in the United States and produces more than 500 million pounds of ground beef products annually, the company said in documents filed in U.S. Bankruptcy Court in Wilmington, Delaware.

The company sells its retail products, which include frozen hamburgers, ready ground beef and beef skillet mix, under the brand names “Moran’s” and “Miller Quality Meats.”

The media backlash over “pink slime” has prompted companies such as Beef Products Inc (BPI) to halt production at some of its plants and has led some big U.S. supermarket operators, including Safeway Inc and Supervalu Inc, to say they will stop buying the ammonia-treated beef. Fast-food retailers such as McDonald’s and school districts nationwide joined in the ban.

The phrase “pink slime” was first used by a former USDA microbiologist, Gerald Zirnstein, who used the term in a 2002 email to co-workers after having toured a BPI plant. The current debate began after celebrity chef Jamie Oliver drew attention to the product.

AFA, based in King of Prussia, Pennsylvania, has plants in California, Georgia, New York, Pennsylvania and Texas. It has about 850 full-time employees. As of December 2011, it posted annual revenue of 958-million dollars.

The company said in court papers it has 219-million in assets and 197-million in liabilities. AFA also said it has secured a commitment for 56-million in debtor-in-possession financing from its lenders GE Capital and Bank of America.

“An orderly sale through Chapter 11 will unlock value and provide a smooth transition for employees, customers and other business partners,” Ronald Allen, interim chief executive of AFA Foods, said in a statement.