(Bloomberg) — United Arab Emirates-based agricultural technology firm Pure Harvest Smart Farms raised $60 million as it looks to expand across the Gulf at a time when the pandemic has exposed risks to food security in the region.
The company’s latest funding consists of a $50 million structured Islamic bond led by Dubai-based finance firm Shuaa Capital PSC, alternative investment manager Sancta Capital Group and Franklin Templeton Investments (ME) Ltd.
Supply disruptions during the coronavirus pandemic have highlighted the potential food security risks for countries like the UAE, whose desert climate with soaring summer temperatures means it has to import most of its food from abroad. The country has lately been supporting local food production and investing in greenhouses, aqua culture and vertical farms.
“We have conquered this extreme climate,” said Pure Harvest’s founder and chief executive, Sky Kurtz. “We developed a solution in one of the harshest laboratories in the world, the Middle East, particularly the UAE with its extreme heat and humidity.”
Pure Harvest will use the funds to grow its presence in the UAE, Saudi Arabia and Kuwait, Kurtz said. It will also diversify its product offering, invest in research and development, and explore other countries to export its technology.
The additional $10 million is in the form of growth equity anchored by an investment from Sancta Capital in January, along with new institutional investors and existing shareholders. Including the latest fundraising round, Pure Harvest has now received more than $200 million in commitments since it was set up less than five years ago.
For Shuaa, this is the second tech investment this month after earlier investing in streaming platform Anghami.
Pure Harvest already secured $29.3 million in series A financing and has obtained a grant from the Abu Dhabi Investment Office. It operates eco-friendly greenhouses to grow tomatoes, which it sells to local retailers, supermarkets and hotels.
“The company has proven that the Gulf can serve as an excellent agricultural base,” said Gus Chehayeb, chief investment officer at Sancta. The region’s abundant sunlight, vast land, affordable electricity and labor mean it can “beat the industrial greenhouses of Europe,” he said.
Abu Dhabi sovereign wealth fund ADQ, whose efforts to boost food security for the UAE included purchasing a stake last year in agricultural trader Louis Dreyfus Co., has previously invested in Pure Harvest. In Saudi Arabia, the company has also partnered with National Agricultural Development Co., part owned by the kingdom’s wealth fund.
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