responsAbility Investments has invested $24m in Peruvian grower and supplier of superfruits Agrovision Corp through its Sustainable Food Latin America fund.
Swiss impact investment manager responsAbility Investments has invested $24m (€22.6m) in Peruvian grower and supplier of superfruits Agrovision Corp through its Sustainable Food Latin America Fund.
Agrovision is one of two holdings in the fund to date, with the first investment of $25m (€23.5m) made in April this year in Campos Borquez, the first regenerative organic certified farming operation in Mexico.
The fund’s aim is to support sustainable farming techniques and integrate advanced processing technologies by investing in companies operating in the fresh fruit and vegetable value chain across Latin America. responsAbility says this is needed to meet growing global demand for nutritious and sustainable food as people become more conscious of their health, as well as the impact of food on climate. According to the UN’s Food and Agricultural Organisation, $83bn of investment must also be made in agriculture in developing countries to produce enough food to feed 9.1 billion people by 2050.
Speaking to Impact Investor, Rik Vyverman, head of sustainable food equity at responsAbility and one of the fund’s three co-founders, said his team were attracted by the company’s sustainable farming techniques and extensive commercial and distribution capabilities.
“Agrovision is a leading producer of organically grown blueberries and other superfruits. The company is vertically integrated and has a high commitment to the UN SDGs in regards to climate action, resource management and social impact. We therefore felt we had a strong alignment with the company,” he said.
The investment team will target a portfolio of 12 to 15 medium-sized, export-oriented companies with access to commercial channels and revenues in the range of $20m-$200m.
Launched in January of this year, the fund has raised $100m so far, from a range of institutional investors and family offices, and has a target of $300m which its managers hope to reach by the end of June 2024.
The fund employs structured mezzanine financing, the rational for which Vyverman said was “driven by the fact that most growers in Latin America are family-owned businesses and exits are not really visible or easy.”
The world’s garden
responsAbility explained that as a region with a competitive advantage in natural resources, immense biodiversity and diverse climate zones, Latin America was ideal for several production windows across both tropical and temperate fruit and vegetable varieties.
The investment manager said that combined with an increasingly health-conscious consumer market, the export volume for fruit and vegetables had greatly increased in recent decades and was expected to continue growing due to rising consumer demand.
One of the fund’s criteria is that all companies have a strong focus on implementing best practices in sustainable farming and deploy both farming and processing technology.
Agrovision is no exception and has a vertically integrated model that combines sustainable farming techniques with extensive commercial and distribution capabilities, which responsAbility said allowed it to supply high quality products to retailers around the world and contributed greatly to global food security.
The company grows, packs, ships and markets superfruits such as blueberries, raspberries, blackberries and grapes from Peru, Mexico, Morocco, and the US state of Oregon to both established and emerging markets including North America, the UK, Europe, China, Southeast Asia, and Central and South America.
Explaining how Agrovision’s impact would be measured, Vyverman added: “Agrovison’s impact will be measured across a number of KPIs identified through our three impact strategies for the fund. Examples include water recycled and preserved, natural forest preserved, area under sustainable cultivation and volume of food produced.”