Hong Kong-based ADM Capital has launched a $100 million fund to invest in agriculture and food companies along the value chain in Kazakhstan.
The CCL Kazakhstan Silk Road Agriculture Growth Fund, ADM’s first agriculture-related investment vehicle, started marketing last year and reached a first close on $40 million in December 2015. KazAgro National Management Holding (KazAgro) and the Hungarian Export-Import Bank made equal commitments of $20 million.
ADM has committed one percent of the first close, or $400,000. Fred Appleby, an investment associate at ADM, said no funds had yet been deployed.
ADM expects the fund to reach the second and final close on $80 to $120 million by late 2016.
It will invest in equity, quasi-equity and convertible-debt investments relating to agriculture and the food chain, including in production, processing, storage and logistics companies.
The fund will target opportunities in Kazakhstan and its neighbours. Meat, dairy, grains, oilseeds, vegetables, fruits and fish food categories at each stage of the value chain fall under the fund’s remit, although it will prioritise businesses positioned to benefit from rapid consumption growth.
ADM Capital, which more 18 years of investment experience in emerging markets across 20 countries, has more than $1.2 billion in assets under management. Over $200 million of that has been invested in food and agricultural. Six of ADM’s agriculture investment exits have realised a gross internal rate of return of 25 percent, the firm said.
The firm also manages the $100 million ADM Kazakhstan Capital Restructuring Fund and the $80 million Kazakhstan Growth Fund. Known investors in ADM’s funds include the European Bank for Reconstruction & Development, International Finance Corporation, Istanbul Venture Capital Initiative and the Netherlands Development Finance Company, according to PEI Research & Analytics.
In 2015, the firm had invested over $165 million in 11 deals across Asia, with its largest exposure in the Philippines
ADM has offices in Hong Kong, Almaty in Kazakhstan, Istanbul, London, Moscow, Kiev and Mumbai.