August 31, 2024

By Gerelyn Terzo, Global AgInvesting Media

Mandala Capital, a South and Southeast Asia focused food and agri private equity firm, has cashed in on one of its portfolio companies. The firm has exited Edward Food Research and Analysis Centre (EFRAC), an India-based lab testing company that Mandala has held for close to a decade. Mandala’s exit was facilitated through M&A amid a deal with testing, inspection and certification (TIC) company QIMA. The latest deal brings Mandala Capital’s tally to three exits completed in the past year, in addition to the upcoming IPO of portfolio holding Godavari Biorefineries.

Mandala Capital originally made the investment through its Mandala Agribusiness Fund 2016 vintage fund, the total amount of which, including both debt and equity, was $8.4 million. Mandala Capital told GAI News that the return was above global benchmark returns for private equity on the investment, adding that its investment pipeline is now focused on 2025 and looks quite strong. The firm is currently raising capital for a new fund that is expected to launch next year and will target opportunities in South and Southeast Asia, including operating companies across the food value chain.

One of the company’s holdings — EFRAC, a Kolkata, India-based lab testing company operating in the food, pharma and enviro verticals that provides testing services for over 500 commodities — has been a success story for Mandala Capital. Under the PE firm’s ownership, EFRAC has doubled its revenue while EBITDA has expanded at a CAGR of more than 50 percent over the past half-decade. EFRAC’s testing ensures that organic products are in fact organic, including testing for fruits and vegetables, corn, soya, cotton, fish and meat, pulses and cereals. EFRAC also provides dioxins, furans, and dioxin-like PCBs testing for animal food and feed, and tests for the same in cement-production processes.

Also on Mandala Capital’s radar is Vietnam, where they noted that nearly three-quarters of the country’s agri-financing demand remains unmet. The PE firm recently invested in agri-fintech company TechCoop, whose mission it is to support smallholders farmers in Vietnam with an integrated financing platform, in an effort to bridge this gap. This investment, which was part of a wider $5 million fundraising round, came on the heels of its successful exit from SAFL, an India-domiciled agri-lending platform. Other backers in the TechCoop fundraising round extended to Ascend Vietnam Ventures (AVV), TNB AURA, Ethos Ventures and South Korea’s MYSC.

On the EFRAC exit, Mandala Capital Managing Partner Uday Garg stated, “Over the years, EFRAC has successfully transformed into a leading integrated laboratory testing company and we are proud to have supported its growth and success. The strategic acquisition by QIMA is a testament to EFRAC’s outstanding track record. We are confident that EFRAC is well positioned under Dr. Bajwa’s able stewardship and we wish the company the very best for its next phase of growth.”

EFRAC Director and CEO Dr. Balwinder Bajwa said, “I would like to thank Mandala Capital for their partnership and support since their investment. Their expertise in the food and agri sector as well as their global network has greatly contributed to the growth of the business.”

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