Macquarie sells Lawson Grains to New Forests and AIMCo

Macquarie Infrastructure and Real Assets has agreed to sell its Lawson Grains cropping portfolio to funds managed by New Forests and Alberta Investment Management Corporation.

The deal was announced this week and will see New Forests and AIMCo extend their partnership in Australian farmland, which began 10 years ago.

AIMCo was the main backer of a deal to acquire forestry and farmland assets from the liquidated Great Southern Plantations in 2011, for a price of A$415 million ($308 million; €259 million). It manages C$1.6 billion ($1.3 billion; €1.1 billion) in timber and agricultural assets located primarily in North America and Australia, as part of a renewable resources allocation within its infrastructure portfolio.

AIMCo was the majority co-investor in the deal alongside New Forests’ first Australia New Zealand Forest Fund, with the assets managed by New Forests since. As well as large amounts of timberland assets, the investment includes approximately 9,000 hectares of canola and wheat cropping land in Western Australia.

The acquisition of Lawson Grains will add another 90,500ha of arable cropping land to AIMCo and New Forests’ portfolio, representing a significant increase for the latter, primarily known for its asset management experience in timberland.

The value of the deal was not disclosed. MIRA declined to comment and New Forests was unable to comment on the deal because it is still awaiting approval from the Foreign Investment Review Board.

MIRA listed the Lawson Grains portfolio for sale in March 2021. It was owned by investors in the Macquarie Crop Partners fund, which is managed by MIRA and which is approaching the end of its 10-year term. This is the primary reason for the sale.

Mark Rogers, New Forests senior managing director for Australia, New Zealand and the US, said in a statement: “This investment is a natural extension to New Forests’ landscape management approach, ensuring integrated production across Australia’s varied landscape, and backed by our valued client AIMCo.”

Headquartered in Albury, New South Wales, MIRA said that there would be no material changes to Lawson Grains’ leadership or to on-farm management teams.

The Lawson Grains business was established in 2010 and first began purchasing properties in 2011. It eventually acquired more than 70 farms which it then amalgamated into 10 aggregations, four in NSW and six in Western Australia.

The portfolio covers 103,006ha in total, of which 89,548ha are arable. It produced 251,364 tonnes of grain in 2020, equivalent to just over 0.5 percent of total Australian production that year.

The NSW properties are the Kealandi aggregation near Moree, the Uah aggregation near Forbes, and the Grassmere and Borambil aggregations, both in southern NSW.

In WA, the properties listed are the Walyoo, Wongan and St Leonards aggregations in the northern Wheatbelt region, as well as the Jerry South, Gunnedoo and Hakea aggregations in WA’s south.

MIRA head of agriculture Liz O’Leary said in a statement: “This transaction demonstrates the natural evolution of agriculture as an increasingly mature and attractive alternative investment class.

“It provides a vote of confidence for investors regarding the opportunity to invest in agriculture businesses and ultimately realize the investments in the same way they are used to doing in other asset classes. Realizing this successful investment will enable our business to look ahead to the next opportunity.”