Assets of failed soy drinks firm up for grabs

Administrators are selling off the assets of Grimsby-based soy drinks manufacturer Soy Magic, which was forced to shut up shop last month just six months after securing its first UK supermarket listings.

The Israeli-backed start-up, which pumped £7M into a purpose-built factory at the Europarc in Grimsby, only secured listings at selected Tesco and Somerfield stores last November for light, original and chocolate chilled soya drinks.

However, sales were simply not strong enough to sustain the business, said a spokeswoman for KPMG, which was called in to handle the sale of the plant and assets.
“They didn’t lose a contract - the sales were just not strong enough,” she claimed. It had not been possible to sell the business as a going concern, she added.
Equipment at Soy Magic’s 3,716 square metre site includes homogenising and pasteurising units, a soy bean liquidiser and packaging equipment.
While the UK market for soya products is dominated by Alpro Soya and So Good, the fact that Soy Magic had managed to win shelf space at Tesco and Somerfield suggested there was room in the market for another player, Soy Magic md Alon Salamon told Food Manufacture​ earlier this year​.
According to TNS, while the UK soy drinks market was worth £69.5M at retail sales value in the year to the end of February 2009, sales had dropped by 6% over the period and even more sharply afterwards as the recession kicked in. Nielsen valued the market at £72.5M over the same period, although it claimed sales had dipped less sharply.
Soy Magic is owned by its Israeli backers, but also secured money from Yorkshire Fund Managers, a local venture capital company.
The firm employed 20 staff, and had hoped to double that number through increasing distribution of its soy drinks and diversifying into juice drinks, smoothies and yogurts. Longer-term, it had also aimed to build up a chilled export business.
Industry sources said they were not surprised that the firm had struggled given the competitiveness of the market and its relative lack of scale compared to major players such as Alpro Soya.