Equilibrium, PSP and Temasek team for Asian CEA expansion

Equilibrium has teamed with PSP Investments and Temasek to back Perfection Fresh, an Australian produce provider intended as a platform for expansion of its controlled-environment agriculture strategy in Asia.

Financial details were undisclosed for the consortium’s acquisition of an undisclosed stake in New South Wales-headquartered Perfection Fresh after a sales process managed by Goldman Sachs.

“Arguably three of the most aggressive investors, broadly in agriculture and technology, are teaming together to drive this platform,” Equilibrium chairman Dave Chen told affiliate title Agri Investor. “It’s not all technology and speculative and in the future. This is a significant revenue-generating company, with significant profitably and significant market presence. We’re just driving growth.”

Perfection Fresh was founded in 1978 and describes itself as one of Australia’s largest privately-owned fresh produce businesses. It owns and operates farms across the country producing branded crops including broccoli, mangoes, cucumbers, tomatoes, berries and bananas. The company also operates a 43-hectare greenhouse vine crop facility and 116 total hectares of berry polyhouses.

Among existing investors backing the company is the Victor Smorgon Group, a family office associated with the Australian Smorgon family that will retain an undisclosed stake in the company.

PSP, which did not return messages seeking further detail, owns a company called Fresh Country Farms devoted to providing capital and expertise to Australasian horticultural businesses aiming to expand domestic and export production, according to the LinkedIn profile of the unit’s chief executive. Fresh Country was involved in PSP’s acquisition of an Australian vineyard in 2018 and includes a unit called Southern Premium Vineyards, according to the executive’s profile.

The Montreal-headquartered Canadian pension made its first investment into Perfection Fresh four years ago, Perfection Fresh chief executive Michael Simonetta said in the company’s announcement of recent investment by the consortium.

“We now look forward to our next chapter with our new partners,” he added.

Portland, Oregon-headquartered Equilibrium closed its second Controlled Environment Foods Fund on $1.02 billion in July.  In addition to US-based CEA producers including AppHarvest and Revol Greens, the vehicle has also supported an investment into Finka, a greenhouse company headquartered in Mexico.

Chen said Perfection Fresh facilities rank among the largest greenhouse assets anywhere in the Southern Hemisphere. Future growth for the company, he said, will focus on buying and building large-scale greenhouses across Asian markets, including China and Southeast Asia. “Mostly building, because there’s not a lot to buy in Asia,” added Chen.

Singaporean state holding company Temasek’s other controlled-environment agriculture-related investments include Unfold Bio, a collaboration with the impact investment arm of Bayer AG focused on creation of seed varieties bred specifically for vertical farming.