London-based private equity firm ADM Capital Europe LLP reports the US$100m first close of its global agribusiness investment fund.
The fund bears the quite clever name Cibus Fund, 'cibus' being the Latin for 'food' or 'fare'. ADM says it is targeting a $500m final close in 2018.
ADM says the fund will focus on mid-market investment opportunities in sustainable food processing and production companies. This will be primarily across Europe and Australasia.
It will have a secondary mandate: to invest equity growth capital in opportunities focussed on parts of the food and agriculture value chain primed for technological disruption and innovation.
It adds that the fund has attracted high quality cornerstone investment. This includes a significant commitment from Nasdaq-listed Arch Capital Group.
World food map changing
W Preston Hutchings, chief investment officer of Arch Capital, said: "The impact of emerging market food demand is changing the world's food map and creating significant investment opportunities."
The team advising the fund is led by Robert Appleby, a co-founder of ADM Capital. A zoologist by training, he has over 20 years of direct international investment experience under his belt.
Alongside him sits Jason Silm, ex-head of agribusiness investment at VTB Capital and director at Macquarie Agricultural Funds Management.
The fund will aim to take advantage of opportunities presented by
- global demographic changes
- shifting trade patterns
- the inability of the world’s fastest growing economies to meet rapidly increasing regional demand for high-value foods driven by burgeoning middle classes.
It will target companies with strong management teams that are active in one or more stages of high-value food chains.
It will look for companies that are established category champions, and which have a demonstrable technological advantage that can support superior returns. Investments will also be evaluated on environmental sustainability as a key determinant of value creation.
Identifying growth drivers
Appleby said: “With an unrivalled network, deep agribusiness sector knowledge and a proven investment track record, we are able to clearly identify the structural growth drivers that are reshaping ecosystems and deliver on the opportunities these present.”
Silm added: “The demand for high-value foods from emerging markets is driving significant opportunities for mid-market food companies predominantly domiciled in Europe and Australasia.”
The fund will enable partners to realise their potential through
- technology adoption
- leveraging the ADM food chain network