(June 25) BURLEY, Idaho — A fresh-cut potato firm that failed to turn a profit for more than five years will put its assets up for auction July 14.

Purely Supreme Foods LLC, which was founded by chairman Mike Zozula in 1998, was granted bankruptcy protection March 26, said Bill Fehr, consultant for the company.

Fehr said the company filed for bankruptcy after it lost a wrongful discharge lawsuit. The suit’s plaintiff sought Purely Supreme’s bank accounts, which the bankruptcy protected.

The firm had not made money since 1998, Fehr said.

“The company is still operating in the pilot plan it started in and it’s capacity restricted,” he said. “In the meantime, the market segment has gotten very competitive.

“We’re unable to produce a mashed line — we don’t have a mashed line — and that represents about 70% of that refrigerated category.”

Purely Supreme’s previous president and chief executive officer, Ed Fong, is no longer with the company. Fehr said he has assumed chief executive duties on an interim basis.

Zozula, who once served as president, remains a shareholder. He didn’t return phone calls.

Purely Supreme produces refrigerated and precooked potato products. It was originally dubbed Redi Foods LLC but its name changed in 2000.

Max Herbold Inc. supplies the company with fresh potatoes and is the lessor of Purely Supreme’s production facility, Fehr said. The firm’s sales office is in Meridian.

Fehr said the company hopes to liquidate all of its assets. An opening bid has been set for about $2.7 million.

Fehr said he couldn’t assign a monetary value to Purely Supreme. He said that estimate would be made by its potential buyers.

“A company that’s never turned a profit is very tough to put a value on,” Fehr said. “I think current owners would think it’s in the double-digit millions of dollars, but ultimately it’s worth what somebody’s willing to pay for it.”

In an e-mail, Zozula said more than $39 million had been invested in the company.