Globe and Mail | 12 December 2013
CPPIB buys Saskatchewan farms in $128-million deal
by ERIC ATKINS
The Canada Pension Plan Investment Board is buying a portfolio of Saskatchewan farms, with the $128-million purchase of Assiniboia Farmland LP.
The 115,000 acres managed by the fund produce wheat, barley and canola, commodities that have seen sharp price increases in the past few years.
“We see this as an attractive opportunity for CPPIB to invest in an established platform of high-quality farmland in a strategically significant agricultural region of Canada,” said Andre Bourbonnais, senior vice-president of private investments at CPPIB. “We look forward to working with management to grow the portfolio and contribute to the development of the farming sector in Saskatchewan.”
CPPIB last year began looking at agriculture as way to generate stable returns and strong growth in the future. Agricultural commodities are expected to enjoy rising demand as incomes rise in emerging markets and diets shift to more protein and high-value crops such as canola.
The price of Canadian farmland has risen by 12 per cent a year since 2008, thanks to low interest rates, rising crop yields and growing overseas markets. The value of farms in Saskatchewan rose by about 10 per cent in each of the past four years and has risen steadily since 2002 amid rising demand for land from out-of-province buyers, according to Farm Credit Canada.
Saskatchewan has 40 per cent of the country’s arable land.
CPPIB, which manages the assets of Canada Pension Plan, the country’s national pension system, said Assiniboia’s managers would continue to run the farms.
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Canada Pension Plan Investment Board to Acquire Saskatchewan Farmland Portfolio
TORONTO, ONTARIO -- (Marketwired) -- 12/12/13 -- Canada Pension Plan Investment Board (CPPIB) announced today that it has signed an agreement to acquire the assets of Assiniboia Farmland LP (Assiniboia), a fund that owns and manages a portfolio of farmland in Saskatchewan. CPPIB's equity investment will be up to $128 million, pending final adjustments. The transaction is expected to close in January 2014.
Created in 2005, Assiniboia's diversified portfolio consists of approximately 115,000 acres of farmland, representing one of the largest investable farmland portfolios in Canada. The key crops produced by the portfolio are wheat, barley and canola. The existing management team will continue to manage the portfolio.
"We see this as an attractive opportunity for CPPIB to invest in an established platform of high-quality farmland in a strategically significant agricultural region of Canada," said Andre Bourbonnais, Senior Vice-President, Private Investments, CPPIB. "We look forward to working with management to grow the portfolio and contribute to the development of the farming sector in Saskatchewan."
In 2012, CPPIB launched its agriculture investment program which will initially focus on farmland opportunities in Canada, the U.S., Australia, New Zealand and Brazil.
"Farmland is an attractive asset class that has historically delivered stable, risk-adjusted returns and the global outlook for agriculture in general is positive due to increasing demand for agricultural products," said Mr. Bourbonnais. "Farmland investments align well with CPPIB's long-term investment strategy while also further diversifying our portfolio. Our initial strategy is to seek partnerships with top quality investors, managers and operators."
About Canada Pension Plan Investment Board
Canada Pension Plan Investment Board (CPPIB) is a professional investment management organization that invests the funds not needed by the Canada Pension Plan (CPP) to pay current benefits on behalf of 18 million Canadian contributors and beneficiaries. In order to build a diversified portfolio of CPP assets, CPPIB invests in public equities, private equities, real estate, infrastructure and fixed income instruments. Headquartered in Toronto, with offices in London and Hong Kong, CPPIB is governed and managed independently of the Canada Pension Plan and at arm's length from governments. At September 30, 2013, the CPP Fund totalled C$192.8 billion. For more information about CPPIB, please visit www.cppib.com.
Contacts:
CPP Investment Board
Linda Sims
Director, Media Relations
(416) 868-8695
[email protected]
www.cppib.com
The Canada Pension Plan Investment Board is buying a portfolio of Saskatchewan farms, with the $128-million purchase of Assiniboia Farmland LP.
CPPIB buys Saskatchewan farms in $128-million deal
by ERIC ATKINS
The Canada Pension Plan Investment Board is buying a portfolio of Saskatchewan farms, with the $128-million purchase of Assiniboia Farmland LP.
The 115,000 acres managed by the fund produce wheat, barley and canola, commodities that have seen sharp price increases in the past few years.
“We see this as an attractive opportunity for CPPIB to invest in an established platform of high-quality farmland in a strategically significant agricultural region of Canada,” said Andre Bourbonnais, senior vice-president of private investments at CPPIB. “We look forward to working with management to grow the portfolio and contribute to the development of the farming sector in Saskatchewan.”
CPPIB last year began looking at agriculture as way to generate stable returns and strong growth in the future. Agricultural commodities are expected to enjoy rising demand as incomes rise in emerging markets and diets shift to more protein and high-value crops such as canola.
The price of Canadian farmland has risen by 12 per cent a year since 2008, thanks to low interest rates, rising crop yields and growing overseas markets. The value of farms in Saskatchewan rose by about 10 per cent in each of the past four years and has risen steadily since 2002 amid rising demand for land from out-of-province buyers, according to Farm Credit Canada.
Saskatchewan has 40 per cent of the country’s arable land.
CPPIB, which manages the assets of Canada Pension Plan, the country’s national pension system, said Assiniboia’s managers would continue to run the farms.
--
Canada Pension Plan Investment Board to Acquire Saskatchewan Farmland Portfolio
TORONTO, ONTARIO -- (Marketwired) -- 12/12/13 -- Canada Pension Plan Investment Board (CPPIB) announced today that it has signed an agreement to acquire the assets of Assiniboia Farmland LP (Assiniboia), a fund that owns and manages a portfolio of farmland in Saskatchewan. CPPIB's equity investment will be up to $128 million, pending final adjustments. The transaction is expected to close in January 2014.
Created in 2005, Assiniboia's diversified portfolio consists of approximately 115,000 acres of farmland, representing one of the largest investable farmland portfolios in Canada. The key crops produced by the portfolio are wheat, barley and canola. The existing management team will continue to manage the portfolio.
"We see this as an attractive opportunity for CPPIB to invest in an established platform of high-quality farmland in a strategically significant agricultural region of Canada," said Andre Bourbonnais, Senior Vice-President, Private Investments, CPPIB. "We look forward to working with management to grow the portfolio and contribute to the development of the farming sector in Saskatchewan."
In 2012, CPPIB launched its agriculture investment program which will initially focus on farmland opportunities in Canada, the U.S., Australia, New Zealand and Brazil.
"Farmland is an attractive asset class that has historically delivered stable, risk-adjusted returns and the global outlook for agriculture in general is positive due to increasing demand for agricultural products," said Mr. Bourbonnais. "Farmland investments align well with CPPIB's long-term investment strategy while also further diversifying our portfolio. Our initial strategy is to seek partnerships with top quality investors, managers and operators."
About Canada Pension Plan Investment Board
Canada Pension Plan Investment Board (CPPIB) is a professional investment management organization that invests the funds not needed by the Canada Pension Plan (CPP) to pay current benefits on behalf of 18 million Canadian contributors and beneficiaries. In order to build a diversified portfolio of CPP assets, CPPIB invests in public equities, private equities, real estate, infrastructure and fixed income instruments. Headquartered in Toronto, with offices in London and Hong Kong, CPPIB is governed and managed independently of the Canada Pension Plan and at arm's length from governments. At September 30, 2013, the CPP Fund totalled C$192.8 billion. For more information about CPPIB, please visit www.cppib.com.
Contacts:
CPP Investment Board
Linda Sims
Director, Media Relations
(416) 868-8695
[email protected]
www.cppib.com
