Blended finance vehicle AGRI3, is officially launched

Published on 06/25/2020 News

The blended finance vehicle will mobilize additional capital for sustainable agriculture and forest protection.

Mirova

Mirova Natural Capital, FOUNT and Cardano Development are pleased to announce that the AGRI3 Fund was officially launched on April 23rd 2020, with the three companies acting as investment advisors.

The AGRI3 Fund is a blended finance vehicle intended to mobilise additional public and private capital, to support sustainable agriculture and forest protection. The Fund is  currently in the process of scaling up operations and identifying a suitable pipeline of investments. This news follows the announcement made earlier this year by the Dutch Government and Rabobank, at the World Economic Forum (`WEF’) in Davos, confirming their combined USD 80 million anchor investment in support of the vehicle.

The initiative - led by UN Environment Program (‘UNEP’) and Rabobank and supported by FMO, the Dutch Entrepreneurial Development Bank and IDH -  was created as a means to help address the limited capacities of commercial banks to finance sustainable and innovative agricultural solutions. To this end, AGRI3 works to provide additional de-risking financial instruments (e.g. guarantees) to partner-banks providing loans and investments to agribusinesses who pursue more sustainable practices. It is intended that these investments will serve as proof of concept to the wider community of banks, other financial institutions and value chain partners, with the aim to ultimately mainstream such sustainable practices across agricultural and financial value chains.

The investment vehicle will provide credit enhancement tools to commercial banks who are financing projects supporting the following impacts;  (i) forest protection and reforestation and/or  (ii) the transition to more sustainable land use practices; and will without exception, contribute to the third impact; (iii) improved rural livelihoods, with the ultimate beneficiaries of these activities being small or large groups of farmers located primarily in middle and lower income countries. These positive impacts will be measured based on a comprehensive Environmental and Social (‘E&S’) framework developed closely with UNEP.

In addition to the AGRI3 vehicle, a separate Technical Assistance (TA) Facility has been set up to support AGRI3 projects that require additional assistance on enhancing their E&S practices. The TA facility will be managed by IDH and will ensure the scaling-up of innovative sustainable agricultural practices to other farmers.

AGRI3 FUND is a Dutch Fund for Joint Account (Fonds voor Gemene Rekening), open to subscription to eligible investors as defined by the fund’s regulation. AGRI3 Fund Manager B.V. is the management company and has delegated investment advisory to Mirova Natural Capital. This fund is approved by the Dutch market authority (the "AFM").
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