New Zealand Superannuation Fund divests interests in 3 offshore funds

Visual of NZ Super Fund homepage. April 2016.

By Shiwen Yap

April 25, 2016

New Zealand Superannuation Fund, New Zealand’s sovereign wealth fund (SWF), has divested its interests in three offshore private equity (PE) funds with, with the consideration and buyer kept confidential.

The sales was reported by New Zealand publication Scoop News. Based on figures from its website, the NZ Super Fund claims to maintains a capitalisation of assets under management (AUM) worth NZ$29.6 billion (US$20.35 billion), with a rate of return per annum after costs and before taxes of 9.44 per cent, as of 31 March 2016.

The fund maintains engages 40 external fund managers, though they have ended four engagements since July 2015, include three announce on 19 April 2016 and added two new external fund managers. It maintains an operating model based on a commitment to active investment management, with the aim of optimising returns and establishing an agile, scalable operations.

Recently, the fund has been said to be shifting towards a more concentrated investment portfolio where it will adopt an activist investor approach. It is also reducing the number of external manager and adviser relationships, preferring deeper relationships and adopting more of a partnership approach.

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The first fund that saw a divestment was Hellman & Friedman VII, which targets investments in the media, financial services, professional services, and software and information services verticals in developed markets,

The other two funds are JMI Equity Fund VII, which targets US-based investments in the software and internet, business services and healthcare IT sectors, and  HIG Bayside Loan Opportunities Fund II. This fund specifically targets stressed and distressed senior debt obligations in US and European small-cap companies. No sales involved New Zealand assets.

According to Fiona Mackenzie, Head of Investments at NZ Super Fund, the investments were amongst their smaller interests, accounting for 0.3 per cent of overall fund size as of June 2015. Mackenzie commented: “The move to sell them is consistent with our strategy to have fewer, deeper relationships with our investment managers. It is also pleasing to be able to realise gains from a part of the fund’s portfolio that has performed strongly in recent years.”

In a separate development, the sale comes as the NZ Super Fund is acquiring 25 per cent of banking services provider Kiwibank Limited, a wholly-owned subsidiary of state-owned enterprise New Zealand Post Limited, in a deal valuing Kiwibank at NZ$1.1 billion. This deal also sees the Accident Compensation Corporation (ACC) purchasing a 20 per cent of Kiwibank alongside NZ Super Fund.

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.
APPLY NOW

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.
APPLY NOW