Futuregrowth Agri-Fund 1
Last updated 11 May 2020, by Impactyield.
Futuregrowth Agri-Fund is a closed-end private equity fund managed by Futuregrowth Asset Management and advised by UFF African Agri Investments.
Futuregrowth Agri-Fund makes socially and environmentally responsible debt, equity and equity-related investments in farmland and related agricultural infrastructure in South Africa seeking both attractive financial return while at the same time poverty alleviation in South Africa.
UFF and Futuregrowth believe that investments in farmland and related agricultural infrastructure in South Africa offer a relatively untapped opportunity to invest in an inefficient market while simultaneously providing capital needed to expand and positively impact the agricultural sector. In order to address the financial needs of low income people, the Fund engages in initiatives to facilitate broad-based economic empowerment in general, and more specifically, economic beneficiation of farm workers.
UFF is a South African based investment management company specialising in agricultural investments in African countries. UFF is supported and partly owned by Old Mutual, Africa's largest financial services group
Futuregrowth Agri-Fund 1 is managed as a equity investment fund able to invest in a wide range of equity and equity-related instruments related to farmland and agricultural infrastructure, with limited capacity to invest in debt instruments in South Africa. Also within the instruments significant flexibility exists, for example in terms of tenor and level of subordination, to provide maximum flexibility for both the businesses to invest in and the Fund, in order to provide the investors with an attractive financial return.
The Fund targets the following focus areas within the agriculture sector: row crops (e.g. nuts and maize), permanent crops (e.g. citrus and deciduous fruit), timber, cattle and dairy. The Fund considers investments in sale-and-lease-back structures with established agrioperators, green field operations (for example the cultivation of pasture land), and cultivation and upgrading of land that is made available by governments under long-term lease agreements.
In general, the Futuregrowth and UFF actively engage with farmland companies invested in, by assuming board member positions and providing companies with advice related to strategy and daily operations. In this respect, the Manager works in close cooperation with third parties, including financial institutions, trade finance organizations, development institutions, governments, universities and consultancy firms, in order to realize additional support and funding.
Equal rights to ownership basic services technology and economic resources
Universal access to safe and nutritious food
Sustainable food production and resilient agricultural practices
Full employment and decent work with equal pay
Develop sustainable, resilient and inclusive infrastructures
Key performance indicators
Asset manager: UFF African Agri Investments
Product track record: Fund has 12 years of track record
Target IRR: 16%
Committed Capital: 560,000,000 ZAR (Rand)
Target return category: Risk-adjusted market-rate of return
Fund domicile: South Africa
Product status: Closed - no longer investing
Inception year: 2010
Vintage year: 2010
Target close date: 01/11/2010
Product term: 10 years +2x 1-yr ext
Assets under management: 560,000,000 ZAR (Rand)
Investment size: Min: 50,000,000; Max: 150,000,000; Avg: 100,000,000
Currency of investments: ZAR (Rand)
Currency for fund / product figures: ZAR (Rand)
Fund investments to date: 4
Fund investments to date exited or repaid: 0
Management fee: 1.75%
Carried interest: 20%
Hurdle rate: CPI+10%%
GIIN Investors' Council Investment: No
Limited Partners / Investors: n.a.
Limited Partner / Investor Type: Pension Funds, Other Institutional Investors
Futuregrowth Agri-Fund 1 aims at providing investors with solid financial returns while at the same time reducing poverty through rural economic development and empowerment in South Africa, by investing in farmland and agricultural infrastructure. Fund investments will seek to contribute to:
• alleviation of funding scarcity for the agricultural industry in South Africa;
• realization of both socially and environmentally responsible investments in South Africa;
• improvement of food security in South Africa through cultivation of land and enhancing yield on existing farming operations;
• improvement of access to market for African agricultural companies through investments in logistics and agricultural infrastructure;
• rural development and economic empowerment of rural communities; and