Agrifunder has been placed in administration and will be put up for sale

Nomura and family office-backed Agrifunder, which provides finance for livestock owners to finish stock, has been placed in administration.

Agrifunder provides finance for farmers to finish their livestock.

Agrifunder, an agricultural finance company backed by Japanese finance firm Nomura and local family offices, will be put up for sale after shareholder issues could not be resolved.

The Sydney-based finance firm was placed in administration this week, with Keith Crawford and Matthew Caddy from McGrathNicol appointed as administrators.

Founder and managing director Damian Burgi told The Australian that a shareholder loan to the company was not refinanced, and the business would therefore be put up for sale as a going concern.

It was reported in late 2019 that Agrifunder had closed a $60m funding round backed by Nomura and led by Sydney-based family office Tozer and Co.

That raise funded the warehouse facility which could then be leant to agricultural borrowers, and Mr Crawford said the lenders which backed that facility were “supporting the process’’.

Nomura also took an equity stake in the business, with company documents indicating about $5.3m had been paid by shareholders for the 3.3 million shares in Agrifunder Holdings.

The documents show Nomura Special Investments holds slightly more than 18 per cent of the shares on issue, with several other shareholders including PAC Partners, Dragonfly Ventures and Halo Ventures owning smaller parcels.

Mr Crawford said there was a shareholder loan outstanding to the holding entity of about $1.2m.

“We don’t have any appointment to the operating subsidiaries,’’ Mr Crawford said.

“We will end up running a process to either sell the business or recapitalise the parent.

“We’ll call for expressions of interest in buying the business. We could, if we wanted, sell the shares in the subsidiaries below it to facilitate that

“The other option is to recapitalise the headstock entity which would mean getting a fresh equity injection from one or more parties.

“The net result for the existing shareholders will depend on where the value falls.’’

Mr Crawford said McGrathNicol was still assessing the total level of debt but it did not anticipate them to be large.

The Agrifunder model involves using livestock as security for the finance extended, with the loan to be repaid on sale of the animals.

Originally published as Agrifunder has been placed in administration and will be put up for sale