Apollo raises $3.2bn with one eye on agribusiness

The energy, metals and mining buyout fund will opportunistically consider inputs, processing, finishing, distribution, preservatives or aquaculture acquisitions.

Apollo Global Management has raised $3.2 billion for its Apollo Natural Resources Partners Fund II, according to an SEC filing, surpassing its $3 billion target.

The fund is primarily focused on global energy, metals and mining buyout opportunities, but its managers are also targeting opportunistic investments in agribusiness, an industry source told Agri Investor this month.

The source said the fund’s return profile would mean it would not target direct investments in farmland or timberland, but consider inputs, processing, finishing, distribution, preservatives or aquaculture acquisitions that fall in line with the fund’s targeted rate of return of above 20 percent.

Investors in the fund include San Francisco Employees’ Retirement System, Teachers’ Retirement System of Louisiana, Santa Barbara County Employees’ Retirement System and New York State Common Retirement Fund, according to PEI Research & Analytics.

Apollo is also still building Pinnacle Agriculture Holdings, the platform created in 2012 by its Natural Resources Partners Fund I to acquire and scale up agri inputs and service providers. The New York-headquartered firm raised $1.3 billion for Fund I in 2012 from some of the same investors that have committed to Fund II, as well as Porvenir and the Athene Annuity and Life Assurance Company.

Pinnacle now operates eight brands in agricultural retail distribution, providing seed, fertiliser and agricultural services. Apollo Global Management invests in private equity, credit and real estate with significant distressed expertise.

Apollo is also the latest firm to be charged by the US regulator for alleged undisclosed fee acceleration, as reported earlier this week. Blackstone is also among firms that have been charged. The firm has agreed to pay $52.7 million to settle the charges, which as well as covering accelerated monitoring fees, also included allegations of misleading limited partners in four funds about fees and a loan agreement, and for failing to supervise a senior partner who charged personal expenses to several funds.

Apollo holds $183.6 billion in assets under management, with investments ranging in size from $200 million and $1.5 billion, according to PEI Research & Analytics.