TIAA / AGR fund gets further LP backing

Regulatory filings suggest the tie-up, focused on family-owned processing businesses, has raised nearly half of its $600m target.

An agribusiness-focused investment vehicle being raised by TIAA and California-headquartered investment firm AGR Partners has added at least one investor since July, regulatory documents suggest.

A Thursday filing with the Securities and Exchange Commission states that the TGAM Agribusiness Fund has raised $254 million from 20 investors since its first sale in July 2015. According to the filing, TGAM Agribusiness Fund has a target of $600 million.

A second filing says that TGAM Agribusiness Fund – B, a vehicle with a target of $247 million, has raised $38.9 million from two investors since its first sale, also in July 2015. A previous filing for TGAM Agribusiness Fund – B showed it as having collected $9.6 million from one investor in July, suggesting that in the time since, a second investor has contributed $29.3 million.

Though the distinct purposes of the two vehicles is not clear, a source familiar with the fund’s structure told Agri Investor in July that each was contributing towards the same $600 million target.

TIAA declined to comment.

A second market source told Agri Investor last month that the fund’s strategy is designed to collect minority positions in family-owned mid-to-upstream processing businesses, with the provision of mezzanine debt as the vehicle’s “preferred pathway.”

“They go in and look for family-run businesses that may not meet the traditional debt criteria of lenders and will come in and take that extra risk in exchange for warrants, [which] will transmit into minority ownership once the debt is repaid,” the source said.

Ejnar Knudsen, CEO of AGR, said in a March interview that his firm generally looks to produce mid-teens to 20 percent annual returns through minority equity and mezzanine debt investments of between $25 million and $200 million in companies with at least $100 million in revenue. The firm has deployed more than $280 million since its 2012 creation.

AGR’s current portfolio contains egg producers Almark Foods and Opal Foods; pet food ingredients provider 3D Corporate Solutions; Ridley Corporation, which sells animal feed and nutrition products in Australia; dairy and livestock equipment maker Tru-Test Group; seafood business Icicle; and corn milling specialist Semo.