eFishery, a prominent agritech startup in Indonesia, is facing a critical situation following allegations of financial fraud. Bloomberg reported on February 5, 2025, that an advisor has recommended that investors quickly decide whether to liquidate or restructure the company. This recommendation came after an internal investigation revealed serious discrepancies in the company's financial reports.

FTI Consulting Singapore Pte, hired by eFishery’s board, is conducting an independent review of the company’s financial standing, including its cash flow, solvency, loans, assets, and liabilities. The review’s outcome will guide shareholders in making the next decision. A vote is expected soon, with options including liquidation, restructuring, or selling the company in full or in parts.

Recently, eFishery’s internal investigation suggested that the company inflated its revenue and profits by nearly $600 million in the nine months ending in September 2024. This figure was allegedly 75% false, as it reported a profit of $16 million but was actually running a loss of $35.4 million. This fraud allegation has shaken the confidence in eFishery, which had once been valued at $1.4 billion and attracted investors like SoftBank Group and Temasek Holdings.

The company's troubles could potentially harm Indonesia's startup ecosystem, which is already facing challenges in securing new funding. Despite its major backers, eFishery’s financial instability could have broader consequences for the local startup industry, which is already struggling.

A decision on whether eFishery will be liquidated or restructured is expected soon, and this will likely set the tone for the future of the company and influence Indonesia’s agritech startup landscape.

SOURCE: BLOOMBERG, BISNIS | PHOTO: SPMTN

This article was created with AI assistance.