First State Super, the A$53 billion Australian superannuation fund, has bought more than 4,000 hectares of almond orchards and land across New South Wales, Victoria and South Australia from Select Harvests, Australia’s largest vertically-integrated nut and health food company.
The investment is structured as a 20-year sale and leaseback from Select Harvests, which is listed on the Australian Securities Exchange. The deal is worth more than A$150 million ($110 million; €97 million), according to Australian Financial Review, and is First State’s first agribusiness investment in the country.
“This investment represents an important strategic opportunity for us to deploy much-needed expansion capital into the Australian agriculture sector. Seen as a premium, high-protein health food product, the almond industry is experiencing strong global growth that is increasing at approximately 8 percent per annum,” First State Super chief investment officer Richard Brandweiner said in a statement.
Brandweiner said that the sale-and-leaseback nature of the investment means First State does not have direct exposure to the operational and agricultural production risks, with returns based around the leasing arrangement and capital growth. “We are not relying on commodity prices in order to deliver a return for our members,” he said.
Chief executive of First State Super Michael Dwyer said it was the fund’s first direct investment in Australian agriculture but he does not expect it to be the last.
Earlier this month Canada’s Ontario Teachers’ Pension Plan (OTPP), and an undisclosed US investor, acquired 1067 hectares of mature almond groves on an own-and-operate almond farm in Australia for A$115 million ($85 million; €77 million).