The Iwi-Māori Direct Investment Fund has so far raised NZ$100 million ($69.1 million; €58.3 million), according to the New Zealand Superannuation Fund, which helped establish the vehicle in partnership with the country’s indigenous group.
The private equity vehicle, expected to hold a final close in December, will enable the participating Māori groups to grow their land, capability and capital, the sovereign wealth fund said.
In a recent interview, NZ Super’s head of direct investments Will Goodwin told Agri Investor that there were several reasons the sovereign wealth fund decided to partner with the Māori. “The first is that it’s a good thing to do and will help improve New Zealand’s private capital markets.”
“The second is that in helping to establish this fund, hopefully we’re going to get reciprocal deal flow out of the Maōri fund,” he added, noting that NZ Super will not be investing in the fund.
Like many indigenous people, the Māori have unique rights on the land as well as on the other natural resources and assets, but not a significant amount of capital, Goodwin noted. On the other hand, as an institutional investor, NZ Super has capital it needs to deploy.
In addition, New Zealand’s legislation prohibits the sovereign wealth fund from owning more than 50 percent of any business, which means NZ Super will need to seek out an increasing number of like-minded partners as it grows.
“Domestically, Māori are probably the best partner we could ask for,” Goodwin said. “As the fund gets bigger, we hope that within a few years’ time it will be a strong investment partner for NZ Super.”
The Māori fund will have a 15-20 year investment horizon with an appointed board and manager and a separate, independent investment committee, according to NZ Super. In addition to the latter, the fund will aim to build similar partnerships with other institutional investors.
The Māori fund is one of several priorities NZ Super has identified for its Investment Hub, an initiative it launched about a year ago with the aim of creating direct investment opportunities in its domestic market.