Mona Dairy has suggested it is on the brink of collapse unless the UK-based private-label cheese business secures new financing or a new owner.
Set up in 2017 by co-owners Ronald Akkerman and David Wynne-Finch, the Welsh company posted a notice on the front page of its website describing the state of affairs after ploughing £20m ($25.4m today) into a facility in Anglesey, Wales in 2021.
“After five years of striving to develop the newest and most sustainable cheese factory in Europe and fighting against many factors outside of our control, Mona Dairy in Anglesey is sad to announce that it has failed to source sufficient short-term funding from its key stakeholders to keep functioning in its current form,” the advisory read.
“We remain hopeful that we can secure a new outcome in the coming days and Mona Dairy will be able to continue its journey, even if that means it is under new ownership.”
With UK interest rates at historical highs to reel in inflation, largely driven by supply chain disruptions linked to the pandemic and then the war in Ukraine, Mona Dairy appears to be suffering the same fate as many start-ups.
An ensuing general risk-off environment has made investors and lenders wary of providing funds, particularly to new businesses, although with UK inflation seemingly now under control there is optimism the financing environment will improve as borrowing costs hopefully come down.
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By GlobalData
Mona Dairy said in 2021 it had taken out a five-year lease on the plant in the town of Holyhead, Anglesey, with an option to purchase the facility once the lease ended.
At the time, the company said the £20m investment to convert the 25,000 square-foot plant included a £3m grant under a local business scheme, along with loans and equity financing.
The site would produce own-label Welsh artisan cheeses, as well as cheddar, Gouda and Edam, targeted at retail and foodservice customers.
Mona Dairy’s “main individual shareholders”, managing director Akkerman and chairman Wynne-Finch, will now “seek to secure a safe home” for the 31 milk farmers supplying the business, according to the advisory.
For the time being, the company added it has “secured an established dairy processing company as an interim buyer” for the milk.
The initial investment in the Holyhead plant was expected to lead to 100 new jobs.
“We will be keeping our staff on for as long as we can, as we work through our options,” Mona Dairy said in its website notice.
