S&A Foods, the Derby-based Asian food producer, is facing an uncertain future after laying off nearly 200 people.
The company, owned by entrepreneur Perween Warsi, has halted production after being unable to pay suppliers.
S&A’s website is now down, and the Unite union has called the situation “dire”.
A spokesperson for S&A Foods said: “The company is hoping to resolve the situation quickly, after which it hopes to be in a position to pay suppliers and resume ready meal production.
“The supply of ready meals to Asda is affected by this situation and discussions are taking place with Asda to try and resolve the matter as quickly as possible.”