SK, China's Joyvio to launch $90 mn alternative food fund

SK Inc., the investment arm of South Korea's SK Group, will launch a 100 billion won ($90 million) fund jointly with Joyvio Group, a unit of Chinese conglomerate Legend Holdings Corp., to invest in alternative protein startups.

The fund launch is part of the Korean conglomerate's efforts to lead Asia's alternative food market and expand its portfolio of environmental, social and governance-themed investments, SK said in a statement on Monday. 
 
Under the recently-signed memorandum of understanding, SK will commit 18 billion won to the Sustainable Food and Consumption Fund. Joyvio, other Chinese food companies and a fund of the Chongqing municipal government will contribute the remainder.

They target plant-based meat producers and fermented food companies, which are grabbing the attention of ESG investors because they contribute to reducing carbon emissions and food safety risks.

The new fund will be managed by Z-Park River Capital, a Chinese technology-focused venture capital firm.

Alongside investing in alternative food companies in China, both SK and Joyvio Group will team up with promising food tech companies like vertical farms which produce food in vertically stacked layers, as well as helping global alternative protein companies' entrance to China.

SK holds a 14% stake in Joyvio, after investing $188 million in the arm of the Hong Kong-listed investment holding company together with Seoul-based STIC Investments Inc., in 2019.

Joyvio, founded in 2012, distributes premium fruit and seafood produced in China, Australia and Chile. It also serves as an investment platform of Legend Holdings.

Last year, SK made its foray into the alternative food market by investing about 54 billion won in San Franciso-based Perfect Day, which produces milk proteins via microbial fermentation.

It follows SK's recent investment of 29 billion won in Chicago-based Nature's Fynd, a company of microbe-based proteins for meat substitutes and dairy substitutes. The US startup's latest funding round, led by SoftBank's Vision Fund II, drew Blackstone Strategic Partners and Hillhouse Investment as well.

To expand its alternative food portfolio into plant-based protein developers, SK said it is preparing to invest in Meatless Farm, a British plant-based meat company, without elaborating further.

The alternative food investment market reached 2.6 trillion won in 2020, a 20-fold surge compared to the 130 billion won in 2016, according to AgFunder, a food tech-focused venture capital firm.

Write to Jun-ho Cha at chacha@hankyung.com
Yeonhee Kim edited this article.