NZ Super Fund accepts Crown offer for KGHL / Kiwibank shareholding
POSTED ON: 22 August 2022
The Guardians of New Zealand Superannuation, the Crown entity that manages the NZ Super Fund, confirmed today it will accept the Crown’s $527 million offer for its 25 percent shareholding in Kiwi Group Holdings Ltd (KGHL), which owns Kiwibank and New Zealand Home Loans.
NZ Super Fund Chief Executive Matt Whineray said the Crown’s offer presented a fair and attractive opportunity for NZ Super Fund to realise its six-year investment in the company. The transaction is subject to regulatory approval by the Reserve Bank of New Zealand - Te Pūtea Matua.
“Kiwibank has performed well during the time we have been a shareholder and we believe our involvement played a crucial part in kickstarting that growth. Kiwibank is in good shape, has excellent leadership and strong prospects for the future,” says Mr Whineray.
“We initially considered buying some or all of NZ Post’s stake and discussed this matter with the Government, but ultimately weren’t able to get agreement on two key issues relating to the asset. Specifically, we sought the flexibility to introduce private sector capital and governance capabilities into the business, and as a wholly-commercial investor we sought to preserve all options for exiting the investment in the future.”
“These requirements understandably did not fit with the Government’s objective for the ownership of Kiwibank.”
Mr Whineray says as the NZ Super Fund matures it will continue to sell as well as buy investments in New Zealand, in line with its independent commercial mandate.
“We continue to work to identify suitable domestic investments that meet the Fund’s commercial requirements while delivering environmental and social benefits.”
The NZ Super Fund purchased its stake in KGHL from NZ Post in 2016 for $263m and invested a further $61.75m in 2017. The investment has earned the Fund a return of more than 10 percent per annum.
The NZ Super Fund has more than $8 billion invested in New Zealand, with substantial exposures to technology, financial services, healthcare, land and housing development, timber, rural land, listed equities and both small and large privately-owned companies.
Earlier this year, the NZ Super Fund announced it would partner with Copenhagen Infrastructure Partners to explore the potential for large-scale offshore wind energy in the South Taranaki Bight.