Natural Drinks Co

It is understood the Natural Drinks Co ceased trading in April after it ran short of working capital

Healthy soft drink manufacturer The Natural Drinks Co has ceased trading after a private investor failed to stump up capital needed to continue production.

The company, which makes Frutree children’s juice drinks, was wound up after hiring liquidators BDO last month, but hopes still remain that its Frutree and Skinny Tonic brands can return to retail stores.

It is understood the company ceased trading in April after it ran short of working capital.

Earlier this year, Natural Drinks told The Grocer that it had secured a seven-figure private investment to help fuel growth plans after failing to reach a crowdfunding target a month earlier.

But sources now say that the investor involved has failed to deliver the promised funding, despite signing legal agreements.

One well-placed source said that although the failure to produce investment left the business with no option but to cease trading, they still expect the money, from an unnamed private fund, to come through and the group hopes to return to production at a future date.

Last November the supplier launched a crowdfunding campaign to raise £750k in order to finance plans to launch a sugar-free range of premium tonics, on crowdfunding site Crowdcube.

It failed to raise the figure, offering equity stake of 7% on an ambitious pre-money company valuation of £10m, when the campaign came to an end in December. At close, the campaign had raised only £225k from 80 investors.

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At the time, a number of Crowdcube community members raised concerns about the valuation of the company, which generated £450,000 in revenues last year, with similar losses.

“After the money was not raised through the crowdfunding campaign, the investor offered a substantial amount and a deal was agreed,” a source close to the company said.

“It was legally binding but the individual has not yet come up with anything - the business was therefore left in the inevitable position of becoming insolvent.”

The start-up planned to soft launch its Skinny Tonic brand at the start of 2018, and looked to accelerate the launch of stevia sweetened flavoured water brand Aqua Tierra. It had forecast sales of the range would hit at least £3.3m in its first year.

Frutree branded drinks were listed by Lidl in 2017 and Iceland until November that year, but it is understood this listing ended following a mutual decision, after margins shrank to single digits making it difficult to battle with larger competitors such as Fruit Shoot.

Kerry Bailey and Edward Kerr of BDO were appointed as liquidators on 3 August.