New Eur100m fund launched targeting sustainable ag and forestry in the Baltic and CEE regions
By Lynda Kiernan
Lithuania’s INVL Asset Management, one of the largest asset management companies in the Baltics, has launched the INVL Sustainable Forest and Agriculture Land Fund II (SFALF II).
With a targeted goal of EUR100 million (US$118 million), the fund’s initial offering has raised EUR32.45 million (US$38.3 million) to-date from private investors to back sustainably-managed agricultural land and forests in the Baltic Sea region and Central and Eastern Europe.
Registered in Luxembourg and administered by Apex Group, one of Europe’s top funds services providers, INVL Asset Management stated that the SFALF II is intended for private investors from the EU bloc.
Founded in 1991 as part of the Invalda INVL group, INVL Asset Management has 28 years of experience in managing private equity assets and growing leaders across the Baltic and CEE regions. The group’s companies manage pension funds, mutual funds, private equity and alternative investments, as well as individual portfolios for a total AUM exceeding EUR1 billion (US$1.18 billion).
Martynas Samulionis, a partner of the INVL Sustainable Forest and Agricultural Land Fund II, noted that SFALF II will initially start with a concentrated focus on agricultural land and coniferous forests in the Baltics that show high productivity and potential for consolidation before geographically expanding outward.
“We’ll start the fund’s activities ‘closer to home’, looking for acquisitions in the Baltic countries,” said Samulionis. “We will invest in Baltic coniferous forests and agricultural land with a high level of productivity and big consolidation potential. Later we plan to expand the portfolio in Eastern EU countries where investment returns are attractive and the regulatory environment is stable.”
“We will heavily emphasize sustainable management of the forests and arable land, considering not just nature conservation but also social responsibility in investing in these asset classes. The fund will operate according to sustainable forestry standards, and we will implement sustainable farming principles on the agricultural land.”
Vytautas Plunksnis, head of private equity at INVL Asset Management, said that the fund will have a hard cap in place of EUR200 million (US$236 million), but noted that as time advances, its investor composition may evolve as some investors exit and others buy in.
SFALF II is an echo of the AGR13 Fund – a $1 billion sustainable agriculture and forestry initiative announced at the World Economic Forum in Davos, Switzerland early this year.
Created by the UN Environment Programme, together with Rabobank and The Sustainable Trade Initiative (IDH), and supported by FMO, the Dutch entrepreneurial development bank, the fund was launched with matching cornerstone investments of $40 million from both the Dutch government and Rabobank and a goal to reach $1 billion.
When AGR13 was announced in January, HE Sigrid Kaag, the Dutch Minister for Foreign Trade and Development Cooperation, said, “The AGRI3 Fund provides a unique opportunity to contribute to forest protection and sustainable agriculture at scale, while also helping to transform the financial sector’s attitude towards sustainable investments.”