American plant-based dairy producer Miyoko’s Creamery has announced its intention to raise $12m in funding and potentially sell the business, according to news agency Bloomberg.
In a letter sent to shareholders on 10 November, quoted by Bloomberg, Miyoko's CEO, Stuart Kronauge, said the group was implementing a “financial stabilisation plan”, to boost profits “and open doors to a range of strategic alternatives, including selling the business”.
According to the letter, sales of its vegan alt-dairy products doubled between 2019 and 2021, hitting $40m, but dropped by 17.5% to $33m in 2022, and sat at approximately $25m in the 2023 third quarter period.
The California-based group, which has a product offering inlcuidng plant-based milk and non-dairy cheese spreads and butter, has faced challenges in the plant-based market and broader economy, Kronauge said in the letter, adding that it had been operating “at large deficits for many years”.
Earlier this year, Miyoko's announced production was being discontinued at its Petaluma, California-based facility, as a result of recent expansion which brought a need for “more scalable production capacity and greater efficiencies”.
No information was given around where it planned to shift production to.
Speaking on the Petaluma closure in the letter, Kronauge said that more cost-cutting measures would be considered in the future.
She added that the company would “continue discussions with potential strategic partners that could result in new partnerships or the sale of the business”, and that such a strategy “requires an immediate injection of capital into the business.”
Within Miyoko’s pool of shareholders, Cult, GroundForce and Obvious Ventures, have already put $1.5m into the company and agreed to invest up to $12m, according to Bloomberg.
In the letter, the company called on its other shareholders to invest, adding that those who don’t could see the value of their stock holdings drop, and lose the “certain liquidation preference and voting rights” they have at present.
Miyoko’s Creamery did not respond to a request for comment from Just Food.
Kronauge was appointed as the new CEO of Miyoko's Creamery in August, replacing Jon Blair, who had been in the role since February when founder and former chief executive Miyoko Schinner left the company.
Miyoko’s Creamery filed a lawsuit against Schinner as a result of her departure. She met this with a countersuit, claiming she had faced gender discrimination.
Both parties reached a settlement in May, with the business saying it would embark on “a new stage of growth.”
The company closed a $52m Series C funding round in 2021. In 2022, it also secured close to $7m in additional equity funding, according to company filings with the Security and Exchange Commission.
