The Danish government is establishing a Kr2 billion ($300 million; €267 million) agriculture private equity fund to promote investment into the country’s agri industry, according to a press release on the Business and Growth Ministry website.
Danish Agricultural Capital will attract investment from local pension funds alongside a Kr500 million investment from the government. And the €23 billion PensionDanmark’s chief executive Torben Möger described the new fund as a “good initiative” on his Twitter page today. He added that he was “ready for dialogue”.
The government is establishing the fund as part of a its Growth Plan for Food and to attract investment into a sector that is lacking funding, according to the release.
“There is … still not the necessary investment in agriculture,” reads the press release. “One reason is that many farms are struggling with high debt and a weak capitalisation, which means that there is insufficient investment in improving and streamlining their businesses and production facilities.”
Business and growth minister Henrik Sass Larsen added: “There is consensus that efforts to reduce agriculture’s high debt must be intensified and strengthened.”
The fund will invest equity into companies setting up agriculture businesses including farms or specific development projects.
The ministry has not yet made any decisions regarding the management of the fund, according to a spokesperson.