AeroFarms files for Chapter 11 bankruptcy

Vertical farming company AeroFarms has announced it has filed for voluntary Chapter 11 bankruptcy protection in Delaware.

They have also filed several "first day" motions with the bankruptcy court "requesting customary relief that will enable it to transition into Chapter 11, with limited disruptions to its on-going core business operations."

AeroFarms says it has also struck a deal with an existing group of investors to secure debtor-in-possession ("DIP") financing. The deal is worth $10 million and, per the announcement, will be part of a larger funding round that includes those investors.

"We are fortunate to have existing investors who continue to believe in AeroFarms and are confident that we can hit our targeted profitable operations for our Danville farm," said Guy Blanchard, President and CFO of AeroFarms in the announcement. "There is incredible consumer and customer interest for our market-leading microgreens, and we are excited to continue be able to build our business to meet that demand."

As part of this move, Blanchard will take on the president role with co-founder and CEO David Rosenberg stepping down; Rosenberg will now work as a special advisor to the board. Blanchard will work with Jim Borel and Peter Lacy, independent board members, to "help guide the Company through the bankruptcy process."

AeroFarms also says it is continuing to build its farm in Danville, Virginia to scale.

In nearly two decades, AeroFarms has raised $238 million in funding according to Crunchbase. In 2021, AeroFarms was going to merge with a Spring Valley Acquisition Crop. The deal would have had them reach a pro forma equity value of $1.2 billion and raise $357 million in gross proceeds, but it did not go through.