Key Takeaways
- The Ontario Superior Court has approved the sale of Aspire Food Group’s assets to Halali Group Holdings.
- Aspire’s cricket processing facility in Ontario struggled to meet production expectations, leading to a financial crisis.
- FTI Consulting facilitated the asset sale, identifying Halali’s proposal as the best option for stakeholders.
Sale of Aspire Food Group’s Assets Approved
The Ontario Superior Court of Justice has granted approval for the sale of Aspire Food Group’s assets to Halali Group Holdings, a company involved in commercial real estate and food manufacturing. While court documents from the receiver, FTI Consulting, lack extensive details, they indicate Halali’s intention to find a commercial tenant for Aspire’s large cricket farming facility in London, Ontario.
Aspire’s London facility was touted as the largest cricket processing facility globally. It encompassed 150,000 square feet and was dedicated to supplying frozen whole crickets intended for animal and pet food markets. In early 2023, Mohammed Ashour, co-founder and then-CEO, had forecasted that production capacity would ramp up to its target of 12,000 tons by mid-2024. However, reports from FTI Consulting revealed that the facility operated significantly below capacity, resulting in financial difficulties.
FTI Consulting’s assessment stated that the underperformance was due to several factors: geographical disparities between the original production processes developed in Texas and those attempted in Ontario, adjustments in growth and harvesting methodologies, and equipment malfunctions. As these issues compounded, Aspire struggled to cover its operational expenses, leading to debts of approximately CAD$44.1 million ($32 million) owed to Farm Credit Canada.
Following its appointment as receiver in May 2023, FTI Consulting explored various options, reaching out to commercial real estate brokerages, liquidators, and potential buyers. The firm received multiple proposals, including a non-binding bid from Aspire’s former management and unsolicited interest from other prospective purchasers.
In June, Halali Group Holdings expressed interest in acquiring Aspire’s assets, submitting a non-binding letter of intent by July 3. After consultations with Farm Credit Canada, FTI determined that Halali’s proposal represented the “best available option” for stakeholders. Consequently, an asset purchase agreement was signed on August 28, covering the majority of Aspire’s assets, including the London facility, equipment, intellectual property, records, and specific contracts.
About a quarter of the funding for the London facility was sourced from government grants, with 30% from loans and the remainder from equity investments, as highlighted in an earlier interview with Ashour. Aspire’s current CEO, David Rosenberg, has been contacted for comment regarding the sale and future plans.
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