ADM Capital announces sixth investment from debut ag fund Cibus

The vehicle, which closed on $322m with an extra $130m for co-investments, has backed food processing technology firm MycoTechnology.

Private equity firm ADM Capital has co-led the $30 million Series C funding round of MycoTechnology, a US-based food processing technology company.

UK-based ADM invested over $5 million through its Cibus Fund, alongside Chicago-based S2G Ventures II, a multi-stage venture fund focused on investments in food and agriculture industries. Participation also included the venture capital funds at Kelloggs, Tyson Foods, Bunge Limited – Eighteen94 Capital, Tyson Ventures, Bunge Ventures respectively – as well as ag investor Continental Grain Company and venture capitalist DNS-Hiitake.

A lot of these funds and investors also participated in giving $35 million to MycoTechnology in 2017, such as Kelloggs.

The funding will allow MycoTechnology to grow its business after it developed a novel organic food processing platform using fungi to transform agricultural material to meet market trends, ADM said. It builds on the success of ClearTaste, an organic product that effectively blocks the perception of bitterness allowing less sugar to be used in sugar alternatives. The funding will also be used to accelerate research and development projects and bring new ingredients to market, ADM added.

“The innovative fungi fermentation platform solves a number of the sector’s biggest challenges, producing a high value, complete protein alternative to animal-based products, increased sustainability, and the ability to drastically reduce sugar content in foods,” Alastair Cooper, senior investment director for the Cibus Fund, said.

ADM’s food and agriculture-themed Cibus Fund has now made six investments, worth $84 million, with co-investments of an additional $23 million in sustainable food processing and production companies. The eight-year vehicle is targeting a 20 percent rate of return and aims to be fully invested in five to seven years.

Investments include $7 million in the US-based vertical farm business AeroFarms, which uses aeroponic indoor growing techniques to cut water and nutrient inputs by over 80 percent; Rootility, a developer of innovative root-focused plant breeding and grafting methods with a focus on the tomato industry; Innoliva, one of Europe’s largest extra virgin olive oil producers, which manages over 6,000 hectares of high-density olive groves in Spain and Portugal; Enterra Feed Corporation, a Canadian producer of insect-based feed ingredients; and a 1,000-acre organic almond orchard in Australia.

A key element of the vehicle, which was given Guernsey Green Fund status for its environmentally positive investments, is to help companies use new technologies to produce better quality products using fewer inputs, the private equity firm said.