AGR Partners has made a minority equity investment of an undisclosed size into Prime Time International, a La Quinta, California-headquartered produce grower, packer, shipper and marketer.
In early May, Prime Time announced the retirement of its founding managing partners and an investment by Nuveen-affiliate AGR that would support growth into “complementary produce items”.
Established in 1992, Prime Time supplies peppers, sweet mini-peppers and asparagus to a variety of foodservice customers. It also provides smaller quantities of corn, tomatoes, green beans and other crops from a network that include processing facilities and farms in Coachella, Bakersfield and Oxnard, California; and Baja California, Mexico.
Davis, California-headquartered AGR’s chief executive Ejnar Knudsen told Agri Investor that Prime Time is a leading provider of field-grown and greenhouse peppers that the firm has known of for more than a decade. A key focus of plans for the company, he said, involves connecting it with the growing number of institutionally backed greenhouses and other controlled environment platforms backed by pensions.
“They [Prime Time] are dominant in the foodservice industry,” said Knudsen. “To use that marketing relationship and position in foodservice to take other produce from institutional/pension-backed greenhouses into their sales channel is an area of opportunity we would like to see developed.”
It is not uncommon for AGR to be the first outside investors in family-owned businesses, as was the case with Prime Time, according to Knudsen. He explained that AGR’s acquisition of a stake from the two founding families allowed the firm to partner with the company’s existing management, who were themselves already minority stakeholders.
“The minority owners, who were managers, were able to increase their ownership and be majority owner and also have our help to position the company to grow and expand their market position in peppers and asparagus,” Knudsen said. “They had known we had helped other family businesses, so it was a pretty quick process of discussion.”
Capital for the investment into Prime Time came from Nuveen Agribusiness Fund III, which launched in mid-2019 with a target of $250 million. December filings indicated AGR had raised $130.6 million from 29 LPs for Fund III and an additional $36 million from two LPs into an related vehicle.
Knudsen said investors in Fund III include a majority of LPs that also made commitments to Fund II, which included public pensions, a church foundation, agricultural banks and several family offices. Fund III follows the same later-stage growth equity strategy as its predecessor, he said, targeting mid-stream opportunities in the US and OECD markets related to healthy food and provision of protein to developing markets.
“We’re on the same track as we were for Fund II; real assets in large cash-flowing business that have a path to potentially double their size over the next decade, generating a good equity return, dividends and current yield over the journey,” he said.
The fund is one of two vehicles managed by AGR, joining Nuveen Ag Infrastructure, which is backed by two public pension plans and was used to support the firm’s mid-2021 investment of $75 million for construction of a high-volume soybean crushing facility near Shell Rock, Iowa.
As of December, AGR managed $476 million in discretionary assets and $109 million in non-discretionary assets, according to a March filing. In a February reorganization, AGR was combined with affiliate European renewables-focused Glennmont Partners to create a new unit – Nuveen Infrastructure – overseen by former real assets head Biff Ourso.