By Gerelyn Terzo, Global AgInvesting Media
Private equity firm Mandala Capital has provided an update on its investment strategy. In a LinkedIn post, the firm tipped its hand to its Fund III launch, anchored by a previously reported $36 million capital injection by the Green Climate Fund. The fund strategy involves investing across the agriculture and food value chain in South and Southeast Asia with a view to activate private capital and scale climate adaptation solutions in the agriculture and food sector. This initiative builds on Mandala’s established track record in the region, emphasizing growth opportunities in sustainable agribusiness sectors.
Singapore’s Mandala Capital is targeting $250 million for Fund III, according to a report in Deal Street Asia. Dubbed the Mandala Capital SSEA Food Programme, the fund targets small- to medium-sized businesses specializing in the food and agriculture sectors. Investment areas span from animal feed to cold chain logistics, encompassing smallholder farmers in the upstream and midstream segments of the agricultural value chain. Key geographies include Indonesia, the Philippines, Thailand, Vietnam and India.
Mandala Capital Founder and Managing Partner Uday Garg believes that Fund III differentiates itself from the pack, telling Deal Street Asia, “We are the only fund in this region with this type of strategy – control investing, focusing on adaptation, the food and agri sector, and with this blended finance structure.”
Mandala is seeking majority stakes in nearly a dozen companies, with individual investment amounts ranging from $10 million-$25 million. The fund prioritizes opportunities that strengthen agricultural productivity and bolster climate resilience, while tackling regional issues like food waste, volatile pricing, malnutrition and increasing protein demands.
Agriculture remains a cornerstone industry in nations such as Indonesia, the Philippines and Thailand, where it employs up to 40 percent of the workforce and produces critical crops like rice. Mandala’s approach stems from the recognition that much of global climate funding has favored mitigation over adaptation. Per OECD data, in the five years leading up to 2021, roughly 25 percent of total climate finance was directed toward adaptation initiatives.
Moreover, as Garg pointed out, investors remain wary of committing capital to this area, especially when it comes to companies in the food and agriculture space. “The experience for venture [investors] in the agri sector over the last 10 years has probably been total devastation of their portfolio,” he said.
Lately, the industry has been linked to ventures carrying substantial risks, especially within Indonesia, where several have collapsed due to problems with oversight and transparency. With this in mind, Mandala Capital is confident that the blended financing model of its Food Program can attract fresh private capital from newcomers seeking their first foray into agriculture and food-related opportunities.
Mandala Capital’s mission involves investing in the food and agriculture value chain across South and Southeast Asia, with a focus on supporting sustainable and resilient agricultural practices. With a view to transform the lives of millions of farmers, the firm partners with businesses to confront challenges related to an outdated food system, supporting productivity, technology adoption and scaling up,
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