NZ Super Fund to invest up to NZ$260 million in small-medium sized New Zealand companies
POSTED ON: 19 December 2016
The NZ Super Fund will invest up to NZ$260 million in small and medium-sized New Zealand companies over the next five to 10 years.
The Fund, which helps to pre-fund universal superannuation in New Zealand, will invest up to NZ$90 million in Direct Capital’s V Fund, up to NZ$120 million into Pioneer Capital’s III Fund, and up to NZ$50 million into Movac’s IV Fund.
The three mandates target different parts of the private equity market in New Zealand, with Direct Capital operating at the larger end of the growth spectrum, Pioneer targeting mid-market companies seeking international growth, and Movac focused on earlier stage, high growth technology companies. Each fund is expected to invest in between 8 and 15 individual companies.
NZ Super Fund Chief Investment Officer Matt Whineray said the NZ Super Fund had been successfully investing in this sector since 2005. Previous NZ Super Fund investments of this type have delivered net returns of about 15% p.a.
“New Zealand continues to provides attractive investment opportunities in small to medium –sized companies which are high growth, typically internationally focused, and able to benefit from the expertise that these managers can provide,” said Mr Whineray.
“External managers are a logical and efficient way for the Fund to get access to the growth opportunities in this sector.”
Mr Whineray said the NZ Super Fund’s in-house New Zealand investment team would continue to focus its efforts on listed equities and larger scale investments (NZ$100 million or more), along with the Fund’s rural and timber holdings.
As at 30 November, the NZ Super Fund had NZ$4.9 billion invested locally, including more than $1 billion in the New Zealand share market, and large investments in Kaingaroa Timberlands, Datacom and Kiwibank. The Fund has returned 9.7% p.a. since inception in 2003.
NZ Super Fund: Catherine Etheredge, Head of Communications, [email protected], 0274-777-501
Direct Capital: Gavin Lonergan, Director
[email protected], 021-277-2482
Pioneer Capital: Randal Barrett, Managing Director
[email protected], 021-575-206
Movac: Phil McCaw, Managing Partner
[email protected], 021-802-170