Plant-based food company Tattooed Chef has announced its intention to file for protection under Chapter 11 of the US Bankruptcy Code.
The US-based company said it will market substantially all of its assets and solicit competing bids from interested parties, in accordance with the sale process under Section 363 of the Bankruptcy Code.
Tattooed Chef’s product range includes cauliflower crust pizzas, ready-to-cook bowls, acai and smoothie bowls and Mexican entrees, which are available in stores across the US.
In a statement announcing the plans, the company’s chairman and CEO Sam Galletti explained that despite best efforts to maintain operations, the business has been impacted by “a challenging financing environment and an inability to raise additional capital”.
Galletti commented: “I remain ever grateful to our colleagues at Tattooed Chef who helped to shape this remarkable journey and help to introduce plant-based foods and healthy eating to consumers across the country”.
The bidding process will be managed by the company in consultation with its advisors, as overseen by the United States Bankruptcy Court for the Central District of California. The company has retained SC&H Capital, an affiliate of SC&H Group, as its investment bank to manage the sale.
Tattooed Chef expects to continue operations during the process, however it said it has provided notice of intended layoffs to employees in California and New Mexico.
Prior to the Chapter 11 filing, the company said its management team and board of directors have evaluated “a wide range of funding possibilities”. It was previously disclosed that the company received unsecured loans from its chairman and CEO totalling $12 million and implemented plans to significantly reduce operating expenses to achieve profitability.
Galletti stated: “We have created a strong brand, a portfolio of frozen plant-based food, a vertically integrated operating infrastructure supported by approximately 400,000 sq ft of manufacturing capacity, and extensive branded and private label manufacturing capabilities. The actions we are announcing today are designed to promote a fast, efficient, and value-maximising sale, which will allow us to provide clarity on the future of the company for all our stakeholders.”
The news comes at a time when several plant-based businesses in the UK have seen similar challenges. Leeds-based Meatless Farm was acquired by VFC Foods last month, shortly after the company entered administration. Yesterday, The Plant Base also reported on UK manufacturer Plant & Bean’s sale to entrepreneur Heather Mills, founder of Vbites, after the business appointed administrators due to inflation and operational issues.
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