Melbourne’s FarmCap, a non-bank lender specialising in agricultural assets, has graduated from investing on a deal-by-deal basis to setting up a fund.
The firm is aiming to raise $100 million for its inaugural FarmCap Private Credit Agricultural Mortgage Fund (Diversified) to lend to Australia’s thriving agri-sector which it predicts will grow from $82 billion in farm production to $100 billion by 2030.
Potential investors have been told to think of 9.5 per cent to 11.5 per cent in annual return – or 5 to 7 per cent over the cash rate – from a portfolio that will include first and second-mortgage loans. It will charge base fees of 1.75 per cent, and a 15 per cent performance fee after a minimum return of 4 per cent over the bank bill swap rate.
The typical borrower is a farmer seeking up to $15 million, to be paid back over six months to 24 months, to fund broadacre, irrigated cropping, livestock and horticulture needs.
The $100 million fund is accompanied by a direct fund, which will house additional stakes acquired in individual deals.
The sales pitch highlighted FarmCap has $40 million worth of deals under offer already, and sources its deals on the ground. Its founder Jonathan Weinstock was previously the head of lending at Ecosse Capital Partners, another agribusiness specialist.
Read the full story tomorrow and more on the Street Talk page.
From the column
Non-bank lender Latitude Group Holdings has brought in Barrenjoey to thrash out strategic options, including an exit for key shareholders including KKR, Deutsche Bank and Varde Partners.
Shipbuilder Austal’s shareholder register was raided by its South Korean suitor Hanwha, five days after it completed a $200 million share issue.
Latitude‘s board has been working with Barrenjoey’s financial services banker Anthony Brasher on its strategic options, some of which are focused on facilitating an exit for the triumvirate of heavyweight shareholders.
