NZ Super Fund sells assets from three private equity investments for undisclosed price

Tuesday 19th April 2016

The New Zealand Superannuation Fund has sold its investments in three offshore private equity funds with the price paid and the name of the buyer kept confidential, though the funds were collectively valued at $101 million in its 2015 annual report.

The three funds are Hellman & Friedman VII which invested in media, financial services, professional services, and software and information services in developed markets, JMI Equity Fund VII which invested in predominantly US-based companies in the areas of software and internet, business services and healthcare IT, and HIG Bayside Loan Opportunities Fund II which invested in stressed and distressed senior debt obligations in US and European small cap companies.

None of the sales involved New Zealand assets.

NZ Super Fund head of investments Fiona Mackenzie said the investments were some of the $28 billion fund’s smaller ones. They accounted for just 0.3 percent of the overall fund size last June.

“The move to sell them is consistent with our strategy to have fewer, deeper relationships with our investment managers,” she said. “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.”

The fund’s target operating model is based on a commitment to active investment management where it expects the returns are worth the effort, and the need to build an agile and scalable operation before Crown contributions are expected to resume in the 2020/21 year.

Along with a more concentrated, active investment portfolio, it has also moved to fewer, but deeper, external manager and adviser relationships, based on more of a partnership approach.

It has a total of 40 external fund managers, having ended four since July 2015 including the three announced today, and added two new ones.

BusinessDesk.co.nz

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