Australian In2Food company collapses for second time with $20m in debt, 1000 creditors

The company, which has sites around Australia has already seen key operations close in some states, while it owes up to $20 million to more than 1000 creditors.

An Australian fresh food distribution company has gone bust for a second time in less than two years with up to $20 million in debt and 1000 creditors owed money.

In2Food Group was placed into voluntary administration on Tuesday with HLB Mann Judd overtaking management of the company.

It had supplied fruit and vegetables to cafes, restaurants, aged care homes and commercial kitchens.

HLB Mann Judd partner Todd Gammel told news.com.au that the Sydney and Melbourne operations of the company had already ceased trading before it was appointed with around 200 jobs impacted at these sites alone.

Overall, there were around 350 jobs at risk, Mr Gammel said but his firm was currently undertaking an urgent assessment to understand the situation.

“The other businesses around Australia have continued and we are urgently looking at how we can fund those businesses to keep them going or for someone to buy them,” he said.

The company owes up to $20 million to over 1000 creditors. Picture: Supplied

Mr Gammel said attempts by In2Food Group to expand by buying other business had not worked and contributed to its collapse.

“From what we understand and it’s obviously very early is that the companies were on a growth phase to make them more sustainable and balanced and less reliant on ongoing funding and were actually unable to get that growth, in terms of acquisitions, as they missed out on one recently,” he said.

“There was a reassessment of their funding requirement and uncertainly around things and there was no further funding from funding parties forthcoming – that meant the director had to consider options and make the decision to put it into voluntary administration.”

There was also a “large volume of creditors” with more than 1000 owed money, including bigger creditors who had funded the vehicle fleet but Mr Gammel said it was too early to put a figure on those debts.

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Its Sydney and Melbourne sites have shut down but other sites like this one in the NT continue to operate. Picture: Julianne Osborne

Initial estimates show the company owes between $10 million and $20 million to creditors and Mr Gammel said they were looking for a buyer or to protect the interest of creditors as much as possible to ensure they got a return on their money.

“We are happy to talk to all the parties around the opportunity and it does have some infrastructure set up. But getting someone to come in to acquire these types of things, we have seen it’s difficult at the moment with other examples, but we are doing everything we can to go and find someone,” he added.

“It’s very early in the process. We are going through our normal approach and keeping everyone up to date. It’s obviously a unique trading environment at the moment so we are doing everything we can to see where we will get to over the next phase of the process.”

In2food, which also previously traded as Yarra Valley Farms Australia, collapsed back in August 2021 blaming the “disruption of snap lockdowns in multiple states” and a “problematic retail journey” into ready to eat meals.

In2Food has collapsed for the second time in less than two years. Picture: Instagram

It had supplied fresh fruit and vegetables to a range of business. Picture: iStock

The company had a deal with David Jones to supply ready-to-eat meals to BP service stations, which failed.

The business had distributed fresh farm foods to supermarkets, hospitals, aged care, retailers, airlines and restaurants and had sites in every part of Australia except Tasmania.

Documents released in September 2021 revealed the company owed $53 million to creditors, including small businesses.

It continued to trade while in administration and was thrown a lifeline in October 2021 when it was bought by Produce Republic – the owner of Aussie Frozen Fruit – which also saved 400 jobs.

The company was sold site unseen due to travel restrictions preventing the new owners from conducting a national tour of plants in person to inspect equipment.