AeroFarms is out of bankruptcy, company president says in Danville talk

AeroFarms, an indoor vertical farming company in Ringgold which filed for Chapter 11 bankruptcy in June, is no longer in bankruptcy, said the company’s president during a speech Wednesday morning.

The company that produces microgreen vegetables and has the largest indoor vertical farming facility in the world at Cane Creek Industrial Center exited bankruptcy Sept. 14, said Guy Blanchard, AeroFarms president and chief financial officer.

“The business was sold to a group of investors that were many of our previous investors, giving us an injection of capital that’s allowing us to not just to continue, but grow and thrive and scale Danville and bring that to profitability,” Blanchard said during a speech at the Institute for Advanced Learning and Research.

Those investors included Grosvenor Food & Ag Tech, Doha Venture Capital and others, he said.

Blanchard also announced that Molly Montgomery is now AeroFarms’ acting CEO and board chair. Co-founder David Rosenberg stepped down as CEO to work as a special advisor to the board.

Blanchard provided an update on the company and the bankruptcy to about 200 people at the two-day Controlled Environment Agriculture Summit East held at the Institute Tuesday and Wednesday.

The CEA Summit East was co-hosted by Indoor Ag-Con and the CEA Innovation Center, a partnership among the Institute and Virginia Tech’s School of Plant and Environmental Sciences and the Virginia Seafood Agricultural Research and Extension Center.

Bankruptcy did not stop AeroFarms from making its microgreen vegetables, Blanchard said.

“One thing that we haven’t ever had a problem with is having great products,” he said. “We’re producing great products today. We produced them consistently through Chapter 11.”

Throughout the bankruptcy process, “our partners in sales, our vendors, our employees were amazing,” he said.

“We had no one run from us,” Blanchard said. “We had people stand by us, partner with us, from … across the industry, that supported us. That support is what allowed us to regroup and come out as a company very strong and positioned for this profitable success in the future.”

Going into bankruptcy isn’t a beginning, he said, it’s a Chapter 11 process — “a chapter in that book.”

“It takes the support of vendors, of customers, of employees, of stakeholders around a company to bring that company through that successfully, which we have done, thanks to all of you,” Blanchard said.

AeroFarms had entered chapter 11 bankruptcy on June 8.

In announcing the bankruptcy filing, the company said it entered an agreement with an already-established group of AeroFarms investors. Those investors were to provide $10 million in debtor-in-possession financing. That, along with cash from ongoing operations, was “expected to provide AeroFarms with the necessary liquidity to support its operations during the bankruptcy process,” a June news release stated.

During his speech, Blanchard started out by giving a history of electric vehicles in the United States and made an analogy between the rise of electric cars and and that of controlled environment agriculture, including AeroFarms.

“Everything that exists … is the result of everything that came before it,” he said.

Responding to an audience member’s question, Blanchard added that “I am not suggesting that a car is analogous to a microgreen, but I do think there are some elements.”

Tesla CEO Elon Musk has a mission to replace internal combustion engines with electric vehicles, Blanchard said, adding that he believed there is some “sustainable-mindedness there.”

The people associated with Tesla also have that same outlook, as does AeroFarms and the controlled environment agriculture industry overall, Blanchard said.

“In many ways, the industry here [CEA] attracts people that are interested in changing the world,” he said. “They’re interested in sustainability, they’re interested in creating cleaner, lower-impact product that is a path forward, with all of the challenges in our food-supply system both here and around the world.”

The idea behind AeroFarms’ indoor vertical farm involves a process that grows crops in stacks at a rate company officials report is 390 times more productive than field-grown plants. Doing so uses no soil, sunlight or chemicals.

The Ringgold facility has 48 plant-growing towers four-and-half stories high, with the operation entailing the equivalent of a 1,000-acre farm, officials said during a tour last year. The goal is distribute primarily to the Mid-Atlantic and Southeast markets with the ability to reach about 50 million people.

Its products are sold at more than 2,000 retail locations, including Walmart, Whole Foods, Harris Teeter, Fresh Market and other stores.

“We have a unique product that customers want to buy,” Blanchard said.

The company was founded in 2004 and is headquartered in Newark, New Jersey.

The local project was announced in December 2019 and eventually expanded its original plans, something the company attributed to meeting an increased customer need. Groundbreaking on the facility was held in April 2021.

A ribbon-cutting event celebrated the opening in September 2022.