February 13, 2024

By Lynda Kiernan-Stone, Global AgInvesting Media

Let’s dig into this one. Temasek has partnered with Singapore-based investment manager Seviora Capital, part of Seviora Group, an independent asset management group with $52 billion in AUM, that itself is wholly owned by Temasek. 

Through this partnership they will jointly invest in late venture and early growth stage agrifood companies in the APAC (Asia-Pacific) region through Seviora Capital’s The Future of Food and Farming (T3F) Strategy. 

Further, Japan’s Norinchukin Bank announced that it has entered into an investment agreement with Seviora T3F as a cornerstone investor for the newly launched fund, and has separately come to an agreement with Seviora Holdings for a strategic partnership with the aim of leveraging their respective expertise in food and agriculture to support the growth of startups in which they invest. 

With Seed backing from Temasek and Seviora, an anchor investment from Norinchukin Bank, and commitments from other institutional investors, the Seviora T3F Strategy has raised $173 million to-date since August 2023. 

Across the APAC region there is a rapidly emerging ecosystem of high-growth agrifood startups that continues to gain momentum. With this capital, the Seviora T3F Strategy is investing in these innovative, high-growth companies that are providing sustainable solutions to meet the challenges created by huge demographic shifts and rapidly evolving consumer demands in both the APAC and global agrifood systems. 

Temasek will leverage its extensive investment network, knowledge, and strong sourcing capabilities to identify investment opportunities, and then Seviora Capital and Temasek will jointly evaluate each case’s potential and capitalize on each other’s complementary strengths to independently make investment decisions. 

“The Seviora T3F Strategy is a unique investment avenue to gain exposure and benefit from the transformation and high-growth in the Agri-Food sector in the APAC region,” said Jimmy Phoon, CEO, Seviora and Seviora Capital. 

“Seviora is excited to jointly invest with Temasek, a globally recognised leader in the Agri-Food sector, to capture the potential of this industry. We will be able to access a strong pipeline of investment opportunities through leveraging Temasek’s extensive network and ecosystem, as well as their experience and success in this space.”

Why Ag?  Why APAC?

Seviora and Temasek noted how they view the agrifood sector as benign at a pivotal inflection point, creating attractive investment opportunities. Through the T3F Strategy, they aim to capitalize upon macro trends that are shaping not only the sector, but the region, and make investments that will drive positive change across the value chain. These include:

~ Asia accounts for 60 percent of the world’s population, but only 35 percent of its arable land, meaning it will have to produce more food on less land as the population continues to grow. The region is also expected to add another 250 million new citizens – an equivalent to the population of Indonesia – by 2030. 

~ The ag sector in emerging economies is significantly fragmented, and is in need of solutions that improve efficiency and increase access to financing and new markets. More than 80 percent of the region’s consumed food is produced by 450 million smallholders who each work plots of land less than 2 hectares (4.94 acres).

~ Asia is currently experiencing sizable shifts in food trends as consumers become more affluent, sophisticated, and demanding, and is positioned to drive US$2.4 trillion in incremental food spend in Asia by 2030. However, this will require US$1.5 trillion in upstream investments to meet this forecast. 

The partners are also keenly aware of the critical connection between the agrifood sector and decarbonization. 

~ Agriculture and food production account for about 34 percent of the world’s emissions – something that is often pronounced in South and Southeast Asia, where it contributes up to as much as 50 percent.

“The transformation of the Agri-Food sector is critical to decarbonisation while ensuring food security, and meeting the evolving needs of consumers,” said Anuj Maheshwari, head of agri-food, Temasek. 

“Through this partnership with Seviora Group, we aim to scale capital and create value by investing in late venture and early growth agri-food companies across the APAC region that are at the forefront of innovation, leveraging technology to drive positive and sustainable change across the agri-food value chain.”  

For Norinchukin Bank, its investment in this fund will work to deepen its knowledge of the food and ag industry in the APAC region and further promote collaboration and joint investment opportunities with Japanese food and ag companies. By bringing back advanced agtech and food tech insights from the rapidly growing APAC region to Japan, and utilizing the platforms of the fund’s portfolio companies, the bank aims to contribute to the overseas expansion and growth of Japan’s agriculture, forestry, fisheries, and food industries.

~ Lynda Kiernan-Stone is editor in chief with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

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