The indoor agriculture business AeroFarms has received more short-term funding to continue operating its Pittsylvania County facility longer than previously announced, but it still might close next month, the company recently told state officials.
If AeroFarms does shut down, the company’s 127 remaining employees will be laid off on Feb. 27, the company said in a Jan. 14 letter to Virginia workforce officials. A few employees might stay longer to wind down operations.
The company’s latest update signals a second temporary reprieve for its employees. AeroFarms said in December that it would shut down the Pittsylvania site that month after its largest investor withdrew further funding. AeroFarms then announced that an existing investor had provided money to continue operations until mid-January.
AeroFarms’ vice president of human resources, Carlos Nunez, said in the Jan. 14 letter that the two companies that make up AeroFarms had “received additional short-term funding from their lender to continue the core operations at the Facility while the Companies continue to pursue strategic options.”
Nunez said that AeroFarms has been attempting to negotiate an extension with the large investor or secure funding from other investors, whether current or new, and from financial institutions.
Nunez did not respond to a message Friday seeking comment. A message to AeroFarms’ media contact was not returned.
AeroFarms produces leafy greens and microgreens such as broccoli and kale at a 140,000-square-foot vertical farming facility in the Cane Creek Centre industrial park. The park is located in Pittsylvania County near the North Carolina border, but is jointly owned by the city of Danville and the county.
“It’s unfortunate that the employees have to deal with such uncertainty,” Danville City Manager Ken Larking said Friday. “It would be my preference that whoever’s making decisions over there would provide some level of stability.”
Although the Pittsylvania County facility remains open, today it employs about three-quarters as many people as it did in early December, according to the company’s letters to the state.
Those letters were sent to Virginia Works, the state’s workforce development agency, to comply with the federal Worker Adjustment and Retraining Notification Act, or WARN Act, which requires employers to provide advance notice of mass layoffs.
On Dec. 11, AeroFarms said it would close the Pittsylvania facility effective Dec. 19. At that time, the company said it had 173 employees there, of whom 127 lived in Virginia.
The company said the closure was because its largest investor had an “unannounced restructuring and change in priorities.” AeroFarms blamed that unexpected development for its inability to provide the 60-day notice that the WARN Act requires.
On Dec. 19, the company pumped the brakes on the closure, saying that an existing investor would provide enough money to keep the company’s core operations going until Jan. 16. At that time, it had 135 employees, of whom 102 lived in Virginia.
In its Jan. 14 letter, AeroFarms said 127 employees remain, of whom 98 are Virginia residents. The total includes 16 primarily remote employees who are furloughed.
New Jersey-based AeroFarms opened the Pittsylvania facility in 2022. The $42 million investment marked the company’s second location.
The company filed for Chapter 11 bankruptcy in June 2023 and emerged from it in September of that year. The new owners closed other facilities and continued producing microgreens at the Pittsylvania site. AeroFarms has sold its goods at stores such as Walmart and Whole Foods.
AeroFarms CEO Molly Montgomery said in an interview last year that the farm’s operations were profitable before interest, taxes, depreciation and amortization, “a huge milestone” for the company.