Paine & Partners Invests in Suba Seeds from $893m Fund IV

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Paine & Partners, the private equity agribusiness firm, has invested in Suba Seeds Company, an Italian vegetable and legume seed producer. This the second investment out of its fourth fund, which closed on $893 million earlier this year and is the largest agribusiness-focused PE fund on record.

Suba produces, packs and distributes seeds for a range of markets from professional to hobby garden markets, and also supplies seed companies. It is recognized for coriander, but also produces beans, peas, radish, cabbage, alfalfa, carrots, chicory and onion seeds, according to a press release.

This is the firm’s second investment into the seed sector after holding Seminis, a fruit and vegetable seed producer, in its second fund. Fund II exited Seminis in 2005.

Paine & Partners Fund IV’s first investment made a rare move into European farmland assets with the acquisition of Spearhead International, a European farming business with farms across much of Eastern European and the UK. The PE firm acquired the business from Altima Partners, a UK hedge fund which is currently divesting much of its agriculture exposure.

The firm also recently exited its stake in Sunrise Growers, the frozen fruits company it acquired in March 2013. Sunrise Growers is targeting one of the food industry’s fastest-growing segments as demand for healthy smoothies and juices rises, John Novak, director at the firm told delegates at the Agri Investor Forum in Chicago today. He said the segment was growing at 17 percent a year. Paine & Partners raised $450 million from the sale to SunOpta, a Canadian food company focused on organic, non-GMO and speciality products.

It’s been an active year for the firm which also divested 70 percent its stake in the Costa Group, an Australian fresh fruit and vegetable grower, in the summer when the company listed on the Australian Stock Exchange. The company raised $553 million at IPO after pricing the deal near the bottom of its price range. It introduces a relatively rare agricultural stock to the stock market — agriculture stocks make up just 1 percent of the MSCI World Index. Costa Group farms across 3,000 hectares of land and 20 hectares of greenhouses in Australia. Paine & Partners retained a 12 percent stake in the business.

Paine & Partners invests across the agribusiness supply chain and focuses on increasing agriculture productivity, changes in consumer behavior and demands, and changing diets in emerging markets. It invests directly in Europe, North America, and Australia, although will make some acquisitions for its portfolio companies in other parts of the world.

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