Toward its goal of doubling its assets under management from C$110 billion (US$82 billion) to C$220 billion ($164 billion) by 2020, Fiera Capital is launching a joint venture with three partners in order to add agriculture to its investment portfolio, and to eventually add private equity.
The joint venture – Fiera Comox Partners – will be headed by Antoine Bisson McLernon who has been named partner and CEO of the venture. Bisson-McLernon and two other unnamed partners will hold a 35 percent stake in Fiera Comox, with Fiera Capital holding the remaining 65 percent.
Mr. Bisson-McLernon was previously managing director and head of natural resources and private equity at PSP Investments, Montreal, which is responsible for managing C$116.8 billion (US$82 billion) in pension assets for Canada’s federal public service employees, military personnel, and Royal Canadian Mounted Police.
Sylvain Brosseau, Fiera’s global president and chief operating officer, told Pensions & Investments that Fiera Comox is planning to launch an open-end agriculture fund that will target a first close of between C$150 million and C$200 million (US$110 million and us$147.5 million) that will initially serve Canadian investors, but will eventually include the U.S.
“We’re optimistic that we can deliver the (agriculture) strategy, first to Canada and then to the United States,” Mr. Brosseau said. “It ultimately will be a global effort.”
The Rise of Agriculture
Fiera’s interest in adding agriculture to its portfolio is reflective of a wider trend of agriculture attracting greater attention from institutional investors as food demand continues to be driven by population growth and shifting demographics in emerging markets.
A recent report issued by Preqin indicates that since 2006 more than 100 unlisted agriculture and farmland-focused investment funds have closed after raising $22 billion in aggregate capital. More so, in 2014 capital raised by closed agricultural funds reached a record $4.04 billion, with 2015 seeing 10 agricultural or farmland funds closing after raising $3.9 billion in capital.
Currently, there stands 48 investment vehicles with a combined target of raising $12.9 billion for ag and farmland investments according to Preqin, with 26 percent of the natural resource investors that the firm tracks investing in agriculture and or farmland. Additionally, of all investors investing in farmland and agriculture, 67 percent report that they would also invest in agtech opportunities.
“We Have the Patience”
For Fiera, Mr. Brousseau referred to the firm’s move to expand into agriculture to P&I as an “organic effort.”
“Most of what we’ve done in alternatives has been done organically,” Mr. Brosseau said. “It doesn’t require a lot of capital, but it does mean we have to find our champions…it requires a lot of work to bring in the right people…It takes three to five years to become profitable, on average. We have the patience to do that.”
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Lynda Kiernan