Agri-Vie’s 1st fund makes penultimate deal

A $5m investment into a Kenyan flower exporter represents one of the $100m Fund I's final deals, as the firm readies a first close for Fund II.

South African food and agribusiness investment fund house Agri-Vie bought a $5 million stake in Kenyan flower exporting business Kariki Group this week, representing the penultimate investment for Agri-Vie I.

The management firm is expected to announce the fund’s final investment at the end of March, completing the $100 million fund’s deployment.

Agri-Vie’s successor fund, Agri-Vie II, is expected to hold a first close in the middle of the year as it aims for a $175 million final close by the middle of 2015, according to Herman Marais, managing director.

“The second fund will draw on the momentum of the first fund and will pursue more or less the same strategy of focusing on food and agribusinesses with a vertically integrated model,” he told Agri Investor.

The Kariki acquisition, a primary activity investment, veered from the firm’s traditional investment route but attracted Agri-Vie’s attention due to its high value, niche market fundamentals. The deal came about when an existing shareholder in Kariki reached the end of their investment horizon and an Agri-Vie employee connected the two companies.

“While we prefer to invest in companies that have a significant value-adding and processing component to their business alongside the primary asset, we are interested in highly valuable, niche plays such as Kariki,” said Herman.

Kariki fits into the existing portfolio alongside leading fresh fruit companies that feed into fast food markets, and vegetable seed companies that operate in South Africa but are also active in Sub-Saharan Africa.

Agri-Vie’s remit is to invest into companies with significant potential for expansion in Eastern Africa and South Africa.