AP1 commits $39m to Southern Pastures – exclusive

The first Swedish pension fund has committed $39m to Southern Pastures' dairy fund, which is targeting a final close on $315m in December this year.

AP1, the Kr252.5bn ($36 billion; €28 billion) Swedish pension fund, has topped up its commitment to Southern Pastures, a New Zealand-focused dairy investment firm by NZ$50 million ($39 million; €31 million) following considerations to do so earlier this year.

AP1 is one of the limited partners of the Southern Pastures fund, having invested $70 million alongside the fund’s founders Prem Maan, Graham Mourie, Taari Nicholas and Phillip Wight when it launched in 2012. AP1 became interested in the Southern Pastures opportunity four years ago, as the fund stood out as the one of the only alternative investment opportunities in New Zealand at that time, according to Rikard Kjorling, external management head at AP1.

Southern Pastures is set to close for the final time in December this year after two years of marketing. It is targeting an overall size of NZ$400 million and has raised NZ$300 million from seven investors so far. Most recently New Mexico Education Retirement Board, the US pension fund, committed $30 million to the fund.

The fund has already deployed NZ$215 million on dairy farms and is conducting due diligence on additional acquisitions.