The EBRD is considering an investment of up to US$ 100 million to NCH Agribusiness Partners II (the “Fund”). The Fund will invest in crop farming operations/assets as well as integrated crop storage facilities with the aim of improving farming yields/efficiency through better farm management and technology and ultimately achieving sustainable levels of profitability. The principal markets for the Fund will be Russia and Ukraine but the Fund will also have the flexibility to invest in other CEE and CIS countries.
The transition impact of the proposed project would come from the following areas: demonstrating the viability of a relatively new asset class of private equity funds investing in agriculture; setting high environmental, social and governance (“ESG”) and integrity standards in the acquisition and operation of land, crop farming and storage operations; improvements in the productivity and efficiency of farmland operations through the adoption of advanced farming techniques and environmentally sustainable farming practices; skills transfer to local employees and other farms with potential spill-over effects to the broader industry.
NCH Capital Inc (“NCH”) is a fund manager that has over US$ 3 billion under management across various asset classes including agribusiness. It has been investing in the EBRD region since 1993.
The Bank will invest up to US$ 100 million.
The target size of the Fund is US$ 1 billion.
The project has been assigned a screening category of FI, as the EBRD financing is via a financial intermediary.
The Fund will be required to comply with the EBRD Performance Requirements 2 (Labour and Working Conditions) and 9 (Financial Intermediaries) and implement the EBRD's Environmental and Social Procedures for Active Equity Investments. The Fund should ensure investee companies comply with national environmental, OHS, social and labour standards.
The Fund will be required to submit annual environmental and social reports to the Bank.
NCH, through its affiliate AgroTerra, is already a member of the Sustainable Agriculture Initiative (SAI) Platform and the Fund will become a signatory to the United Nations Principles of Responsible Investment in Farmland (UNPRI).
Christopher C. Abbott
NCH Capital, Inc.
452 Fifth Avenue, 24th Floor
New York, New York 10018
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