May 29, 2015
Canada’s largest alternative asset manager, Toronto-based Brookfield Asset Management, has reportedly raised $300 million for its new agricultural fund created to target Brazilian farmland.
The firm is aiming for corpus of $500 million for its Brookfield Brazil Agricultural Fund II, with maximum of $700 million set. The investment fund will be used primarily to acquire cattle ranches that will be converted into soybean and sugarcane farms.
Brazilian farmers have expanded soybean acreage in the country by 11 million hectares (27 million acres) since 2006, mostly through conversion of cattle land, as demand from Chinsteadily climbs. Despite the need for high initial capital expenditure for intensive fertilization, converting pastureland into soy or sugar increases the value of the land while producing more valuable crops.
Brookfield was originally founded in Sao Paulo, Brazil in 1899 under the name, Brascan Ltd.(combination of Brasil and Canada) before changing its name in 2005. It has since grown to have global presence with over $200 billion in assets under management.