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Ngai Tahu key investor in $105 mln Movac technology fund

Friday 11th November 2016

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Technology investment fund manager Movac has raised $105 million for its latest fund, including $75 million from institutional investors such as Ngai Tahu Holdings, the iwi’s commercial arm.

Movac partner Phil McCaw said he couldn’t name the other institutional investors for Movac Fund 4 but the balance of the funds has come from the New Zealand Venture Investment Fund, leading New Zealand family offices, community trusts and private investors, including investor migrants.

The fund will be investing in established New Zealand technology companies with a track record of sales that are looking for capital to accelerate their growth and scale their business internationally. It is a later stage fund than Movac’s previous ones and covers an area where there is currently a large gap in investment capital.

McCaw said it has a strong pipeline of potential investments for the new fund and had already conducted due diligence on a number of quality companies. He anticipates making the first investments before Christmas.

The fund will remain open until its final close in April next year.

Founded in 1998, Movac has deployed more than $65 million in capital by investing in 25 companies that have helped create over 250 jobs in New Zealand. Significant returns to investors have come from its investments in Trade Me, eBus, GreenButton, and Givealittle.

Ngai Tahu Holdings chief executive Mike Sang said the company was looking forward to its new partnership with the Movac team and adding diversity to its portfolio by investing growth capital in the tech sector. Its other interests include farming, property, seafood, tourism, transport, and mānuka honey.

At an International Forum of Sovereign Wealth Funds in Auckland yesterday, Sang was asked how important it was to separate the commercial investment arm from the tribal owner.  

He said he hated the term separation and questioned how the commercial arm could be separate when it was owned by its owners.

“No capital works when divorced from its owners,” he said. “We tend to view it as bits of the jigsaw that fit together to give you the whole picture rather than truly separate entities.”

Te Runanga o Ngai Tahu sets the investment policy framework, the risk they're prepared to take, and annual spend while the commercial arm carries out the investment and the distribution arm is responsible for allocating returns.

Having a framework and structure where everyone knows their role and how it fits together and works well together was more important than separation, Sang said.

“That got broken, in people’s minds they saw it had been broken and they saw Holdings wasn’t aligned with its owners so they made a change.”

In April this year Mark Solomon stood down as head of the tribe’s parliament, a position he’d held since Ngai Tahu agreed to a $170 million Treaty of Waitangi cash settlement in 1998.

BusinessDesk.co.nz



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