Abu Dhabi-based agri-tech company Pure Harvest Smart Farms raised $60 million through two financing deals that will help the firm expand its operations and accelerate its growth to other GCC markets.
The company secured $50m through a Shuaa Capital-led structured Islamic debt deal in which Sancta Capital and Franklin Templeton were anchor investors. This follows on from a $10m equity financing round led by Sancta Capital in January, it said in a statement on Monday.
The funding “supports our aggressive growth campaign within the GCC region”, Sky Kurtz, co-founder and chief executive of Pure Harvest, said. “This type of financing underscores the innovation occurring within the region’s venture capital markets.”
Pure Harvest, which raised $29.3m in Series A financing last year, aims to produce sustainably-grown local produce throughout the year.
It will use the proceeds from the latest financing deals funds to support capacity expansions, attract new talent to the company and boost research and development, including innovation projects in partnership with the Abu Dhabi Investment Office.
Covid-19 has highlighted the need for domestic food production to reduce reliance on international supply chains, Mr Kurtz said.
The pandemic, which has infected more than 120 million people around the world and claimed over 2.66 million lives, brought global trade to a halt last year. The closure of borders to stem the spread of the virus also exposed vulnerabilities in food-importing countries.
Between 80 and 90 per cent of food in the GCC is imported, according to Chatham House. However, improving food security and innovation in agriculture are among the top priorities for the UAE, the second-biggest Arab economy. The Abu Dhabi government has already earmarked Dh1 billion ($272m) for an agri-tech incentive programme as part of the government’s Ghadan 21 accelerator initiative.
In November, the Adio said it is dispersing $41m to three technology firms – Pure Harvest, grocery platform FreshToHome and space research firm Nanoracks – to develop local expertise and new ways of producing food in arid climates.
Efforts to improve local food production are already bearing fruit, as the amount of locally-harvested produce steadily rises as farming ventures increase production through the use of technology.
“Investors seeking access to middle-market credit transactions is increasing across the region, and is particularly exciting in growth sectors that are addressing global challenges like water scarcity and food security,” Mohieddine Kronfol, global sukuk and Mena fixed income chief investment officer at Franklin Templeton, said.
“We’re backing the region’s pioneer in high-tech agriculture and supporting their efforts to have a large-scale impact in the markets they serve.”
In September, Pure Harvest said it will invest over €30m ($35.85m) to build a hi-tech farm in Kuwait to supply fresh fruit and vegetables to The Sultan Centre, one of the country’s biggest independent supermarket operators.
The company also secured a multi-stage investment commitment of $100m last year from Kuwait’s Wafra International Investment Company to fund hiring and expansion across the region.
“We are passionate about our mission to make local-for-local production of high-quality fresh produce possible anywhere, including within the harsh climate of our home the Arabian Gulf,” Mr Kurtz said.
Published: March 15, 2021 09:31 AM