gaspari_logoAccording to the Wall Street Journal, Gaspari Nutrition has been sold. It is reported that Rich Gaspari will be staying on as an employee.

Below is the report that appeared on The Wall Street Journal:

A New Jersey company that makes protein powders and other muscle-building mixes has been sold out of bankruptcy for $10.1 million.

An affiliate of the U.K.-based Body Temple Ltd. won a heated auction for the nutritional supplement company built by ex-professional bodybuilder Rich Gaspari. The company, Gaspari Nutrition Inc., filed for bankruptcy on Oct. 14 after a slump in demand for its products, which sell online and at retailers like Vitamin Shoppe VSI +1.31%.

The deal closed on Dec. 23, according to documents filed in U.S. Bankruptcy Court in Trenton, N.J.

Mr. Gaspari no longer owns the company but is expected to stay on staff. Known professionally as the “Dragon Slayer” before he retired, Mr. Gaspari was a three-time runner up for bodybuilding’s top title of Mr. Olympia and got the 2013 Arnold Schwarzenegger Lifetime Achievement Award.

The company plans to keep its promotional contract with Hidetada Yamagishi, the first Japanese bodybuilder to compete in the Mr. Olympia contest.

Annual sales for Gaspari Nutrition’s muscle-building formulas like “Aminolast,” “Super Pump,” and “MyoFusion Advanced” have fallen from a peak of $78 million in 2011, according to earlier court papers.

The company’s lawyers didn’t specifically say why sales fell, but a basic Internet search shows that the company has been scrutinized by newspaper reporters and U.S. Food and Drug Administration regulators over products like its testosterone booster Novadex XT. Gaspari Nutrition recently paid about $131,000 in a class-action lawsuit over the weight-loss supplement Spirodex.

Gaspari Nutrition has also fought an expensive battle—spending at least $1.7 million—against another ex-bodybuilder, Ron Kramer, who founded competing nutritional supplement maker ThermoLife International LLC.

These have been shaky times for some companies in the bodybuilding supplement industry. Earlier this month, the manufacturer of the Prostar bodybuilding protein shake filed for bankruptcy, blaming regulatory scrutiny and a battle with a bank over a $13 million loan.

Even though the 200-worker company in Connecticut profited from $44.6 million in sales last year, it struggled to make up for a $1 million loss in 2012 after having to pay “millions of dollars of one-time temporary labor charges incurred due to labor strife and onerous regulatory requirements,” the company said in court papers.

The company didn’t provide more details about the labor charges, but FDA records show the company was hit with more than 20 quality-control citations after inspectors visited its facility in 2011. Gaspari Nutrition and its lawyer did not respond to requests for comment.