Vertical farming company Jones Food Company collapsed owing creditors £22m, according to a report by its administrators.
The Lydney, Gloucestershire-based business was placed into administration on 7 April, with 61 staff made redundant.
The report, filed at Companies House, revealed the business closed owing £22m to 88 creditors.
Administrator RSM said the company was only operating at “a third/half of the factory’s capacity” with low margins secured on products sold.
The company failed to turn a profit in any of the years it was operational.
The report added that sales were unpredictable and often lower than the forecasted demand, which resulted in crops having to be disposed of as waste, incurring further cost to the business.
At the time of administration, a total of £16.8m of the £22m owed was to 12 convertible loan note holders including Ocado Ventures, a major shareholder in the business.
Ocado held 54.6% of the share in JFC. It invested £8.6m in the business initially in 2019 and a further £3.7m in 2023, with an additional £1m invested in January 2025, funds it will most likely not get back.
Read more: Collapse of vertical farm Jones Food Company was ‘inevitable’, group warns
The company is also listed in the list of owed creditors with a total of £69.9k owed across both Ocado Central Services and Ocado Retail.
HS Credit, a commercial property loan provider, was also owed £3m at the time of collapse.
The business owned land and property to the value of £12.7m with an additional £69.9k in total assets available for preferential creditors.
In the administrators report, it said the directors regularly undertook reviews of the current and future cash position, which is why the need for additional funding was identified to support JFC’s expansion plans in 2023 and 2024.
The company opened the “most advanced” vertical farm in 2024, which promised to “revolutionise food production, combat climate change, ensure food security, address labour issues and maximise efficiency”.
At the time of launch founder, founder and CEO James Lloyd-Jones said, “commercial success in this sector has always been the challenge, but this farm smashes it”.
Further funding was identified to be required throughout 2024, and beyond which was when Ocado provided an additional £1m in funding. JFC also explored options to raise additional funds through new equity and debt finance, but no material interest was received that could be progressed within the required timeframes.
At the start of February, the directors appointed RSM UK Restructuring Advisory to review the company’s financial position, but no viable funding offers materialised and RSM was formally engaged to initiate accelerated sales process for the business and its assets.
This also failed to produce any viable options, which led to the decision to place the company into administration.
Ocado has been approached for comment.
No comments yet