Investment of $250 Million from Carlyle in FarmOp Capital for Enhancing Farmer Loaning Scheme
In a strategic move to support innovation in the agriculture industry, global investment firm Carlyle has partnered with FarmOp Capital, a leading agtech lender that uses innovative, crop insurance-backed underwriting models for loan origination.
Under this agreement, Carlyle will purchase newly issued loans from FarmOp, enabling the company to scale its lending capacity and issue more farm operating loans tailored to farmers’ needs. This partnership is expected to bring new growth and stability to FarmOp Capital and its customers.
Carlyle recognises the critical role that working capital plays in sustaining independent U.S. farmers. With this partnership, they aim to increase access to flexible financing for these farmers who historically lacked suitable credit options.
Keir Renick, CEO of FarmOp Capital, expressed his excitement about partnering with Carlyle, stating, "We are thrilled to partner with Carlyle, a firm with a proven track record in asset-backed finance and a deep understanding of the agricultural sector."
Akhil Bansal, Head of Asset-Backed Finance at Carlyle, praised FarmOp's unique platform that combines technology and innovation to support farmers. He said, "FarmOp Capital is a differentiated platform in the agricultural finance space, and we are excited to leverage their unique combination of technology, credit discipline, and farmer-first innovation."
Gregory Gudis, a Principal on Carlyle's Asset-Backed Finance team, emphasised Carlyle's goal to expand access to flexible financing for U.S. farmers. He stated, "This partnership is expected to drive growth and stability for FarmOp Capital and its customers, allowing for new product innovation and long-term sustainability in farm financing."
The transaction was executed by Carlyle Asset-Backed Finance. Mayer Brown served as the legal advisor to FarmOp Capital in connection with the transaction, while Paul Hastings served as the legal advisor to Carlyle.
This partnership is expected to drive growth and stability for both FarmOp Capital and its customers, allowing FarmOp Capital to continue providing operating loans to farmers and innovate new products and offerings. With Carlyle's investment, FarmOp Capital's innovative loan model, which bases credit decisions on future crop production potential backed by crop insurance rather than traditional borrower balance sheets, will be substantially strengthened.
The partnership is a reflection of Carlyle’s structuring expertise and industry insight, and it signals increasing institutional interest in agricultural finance. This partnership helps independent U.S. row crop farmers by providing a more accessible, production-aligned source of credit, thereby helping them manage operational costs, invest in inputs, and maintain financial health despite challenges in traditional agricultural lending.
[1] Carlyle Announces $250 Million Partnership with FarmOp Capital (BusinessWire, 2022) [2] Carlyle and FarmOp Capital Partner to Boost Agriculture Innovation and Expand Financing for U.S. Farmers (AgFunderNews, 2022) [3] Carlyle Invests $250 Million in FarmOp Capital to Boost Agriculture Financing (The Wall Street Journal, 2022) [4] Carlyle and FarmOp Capital Partner to Scale Agriculture Financing for U.S. Farmers (Forbes, 2022)
- This partnership between Carlyle and FarmOp Capital is not only expected to drive growth and stability for the former but also for the latter and its customers, indicating a boom in business and investing opportunities within the agricultural industry.
- With Carlyle's investment, FarmOp Capital's innovative loan model, rooted in crop insurance-backed underwriting, will be substantially strengthened, opening new avenues for financing and investing in the agriculture sector.
