Atkins Nutritionals, the company behind the low-carb diet craze has applied for bankruptcy protection in the US.

Dr Robert Atkins created the diet, which caused a headache for the potato sector, and founded the company in 1989 to promote the concept.

Despite an initial keen up-take among consumers, demand for the Atkins diet has dipped amid questions about its safety and following the death of its founder.

Other firms also jumped on the bandwagon, offering similar products and eating into Atkins’ sales.

The firm has now filed for Chapter 11 status, which allows it to keep trading while providing protection from creditors to see if it can work out a rescue plan.

According to reports, the company owes lenders close to $300m. It has secured funding of $25m to finance day-to-day operations.

President and chief executive Mark Rodriguez said Atkins has adjusted its structure "to accommodate a smaller business" and will promote its brands "more broadly for consumers who are concerned about heath and wellness".

After it leaves Chapter 11 protection, the company will focus on its nutrition bars and drinks, Mr Rodriguez said.

Critics of the diet pointed to the lack of fruit and vegetables in the plan, and said consumers needed to eat a more balanced diet.