Deals

RDIF and China’s Inventis launch $500m investment platform

Agriculture, food and retail will be top priorities for the Sino-Russian vehicle, which will also target mining and infrastructure investments.

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The Russian Direct Investment Fund will establish an agriculture, food and infrastructure investment platform with Shanghai-based Inventis Investment Holdings, one of China’s oldest and largest private equity investment firms.

RDIF and Inventis, which manages $6.2 billion in assets, will look to generate returns by focusing on growing trade between Russia and China. They will co-invest up to $500 million in food, agriculture, consumer and retail businesses, with transport, mining and infrastructure opportunities also being targeted, according to an RDIF press release.

“Together we can successfully contribute to unlocking the investment potential of Sino-Russian cooperation in the most dynamically growing sectors of the Russian economy,” said RDIF chief executive Kirill Dmitriev.

The $10 billion RDIF fund has made $2 billion in co-investments in agriculture since it was launched in 2011 and plans to a commit further $2 billion over the next two years. Much of that will target the Russian, Chinese and Middle Eastern markets, Dmitriev told Agri Investor earlier this year. Western sanctions and the devaluation of the Russian rouble created strong opportunities to invest in domestic production, as well as build on ties with eastern markets, he added.

The Russian government-backed fund has signed a memorandum of understanding for a $1 billion deal to establish Russia’s largest dairy this year, as well as entering agreements to build poultry and rice businesses targeting domestic and Chinese markets. The deals involve extensive agri infrastructure and technology investments to create vertically-integrated businesses.

Inventis set up its first private equity fund targeting China in 2001 and has since made more than 50 investments in the country. Although it is sector agnostic, agriculture is one of its eight specialist investment areas, according to its website. The growth-focused firm would typically invest $50 million for a minority stake with a five-year investment period, according to the site.