Summit Agriculture Group forms $300 million ag fund

Alden based Summit Agriculture Group has formed a $300 million investment fund that will focus on agriculture companies throughout the Midwest.

With the new fund, Summit plans on investing in two to three agricultural companies per year over a three-year period.

“I think the catalyst for the fund was a continued recognition of a couple of trends in agriculture,” said Justin Kirchhoff, Managing Director of Summit and head of private equity. “One is a continued need for growth and food production and more with less in terms fewer acres per capita. And then, more locally, in Iowa and the Midwest, we recognized that there’s not always a lot of alternatives for agribusinesses to grow their business via different capital providers.”

The new fund will primarily provide capital for midsize businesses with revenues between $20 million and $200 million.  

“We’ve also identified that these guys who have developed rather successful businesses may or may not have that next generation of ownership or management available to them,” Kirchhoff said. “Our goal is to be a value-added partner to them and come in and continue the legacy of their business and grow it alongside them.”

Past investments by Summit include investments in Heartland Pork, Hawkeye Renewables and Iowa Winds.

Summit will look for a majority share of each company it invests in but plans to keep in place present company managers as part of a stronger team with access to more resources.

“Our intention is not to recreate the wheel of a successful business,” Kirchhoff said. “It’s to expose them to our financial and agricultural network that we have, both in the Midwest and on the east coast, opening doors for them that otherwise might not have been available to them.”