Indebted London cricket producer in receivership

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By Jiminy, London’s cricket dreams have run into a financial roadblock as menacing as, well, a massive can of Raid.

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Aspire Food Group, reportedly owing $41.5 million, has been placed into receivership, a step toward bankruptcy. It received $8.5 million in federal government support in 2022.

The plant, which now employs about 50, is still running as it searches for either a buyer or new financing, said Kapil Lakhotia, chief executive of the London Economic Development Corp.

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“It’s unfortunate, but there are other options being pursued,” he said. “There were a lot of promising early signs, but it’s not uncommon for early stage businesses to face issues when dealing with new products and new technology.”

David Rosenberg, Aspire’s chief executive, declined comment Tuesday. Chief operator Gabe Mott could not be reached for comment.

Aspire was placed into receivership recently after an application from Farm Credit Canada (FCC) in Ontario Superior Court. That application said FCC was seeking $22 million in immediate payment, but the website insolvencyinsider.ca stated the total debt is $41.5 million.

Sylvain Charlebois, a food industry analyst, said the plant’s financial woes are a result of Aspire marketing crickets to humans instead of as livestock feed, fertilizer or as a pet food additive.

“I think it boils down to bad management. There’s tremendous potential for that plant, but it’s not about feeding people,” said Charlebois, a senior director of the Agri-Food Analytics Lab at Dalhousie University. “There are opportunities but it has suffered from bad PR.”

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One challenge facing the business if it closes the plant is that it is a purpose-built structure that can’t be easily used for other manufacturing, he said.

“That plant is state of the art, it can’t make anything else,” Charlebois said. “If it survives, it has to be refinanced and it needs people who know and understand the cricket market.” 

Insolvencyinsider.ca also reported the London plant remained at or below 50 per cent production capacity and defaulted on a credit agreement by failing to maintain a $1-million cash balance. In addition, Aspire owes more than $1 million in unpaid property taxes, the website reported.

Aspire laid off 100 workers in November, saying it had to downsize as it was changing technology to improve production. It began production in 2022 with $8.5 million in federal support for construction costs and to help pay for artificial intelligence technology to monitor cricket production.

“I grew up eating crickets in my porridge as a kid because they bring so much protein,” London West MP Arielle Kayabaga said as she announced the funding in June 2022.

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Aspire Foods hatches and grows crickets on site. It then freezes them and ships them to be made into tasteless, odourless protein powder to be added to products as a high-protein, low-fat, low-cost additive.

In addition to processing crickets, it also produces frass, cricket excrement sold as a soil nutrient.

Aspire Foods, located on Innovation Drive, opened its 14,000-square-metre (150,000-square-foot) plant in 2022. It has the capacity is to process 13 million kilograms of crickets a year. Aspire operates another plant in Austin, Texas.

ndebono@postmedia.com

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