VTB Capital creates the world biggest fund to develop agriculture.
The Agri Fund will invest up to $1 billion in agriculture. Russia and Kazakhstan will be the first locations where the fund will start buying all types of assets – from land to processing companies.
“The initial $250 million will be ready in 1Q 2012”, says Tim Demchenko, a head of direct investment management at VTB Capital, talking to Vedomosti.
The fund will become one of the global leaders in agricultural investment, says Kirill Dmitriev, CEO at The Russian Direct Investment Fund, adding that the sector in Russia really needs money. The investment need of Russia’s agriculture was estimated at around $70 billion for 2008 – 2013.
Also, according to Aleksey Krivoshapko, director at Prosperity Capital Management, there is just a handful of successful managers and companies in the sector, which means there is huge growth potential.
However, Dmitry Rylko, CEO at the Institute for Agricultural Market Studies, thinks it’s essential to have an efficient balance of centralised management and independent operations of each farm within the fund.