
NZ Super, ACC exit Kiwibank via $1.3b NZ government buyout

New Zealand Superannuation Fund (NZ Super) and Accident Compensation Corporation (ACC) have exited state-owned Kiwibank at an implied valuation of NZD 2.1bn (USD 1.3bn).
The transaction will put Kiwibank, a bank set up by New Zealand Post, under direct government control. Both NZ Super and ACC are government entities but with financial mandates at odds with continued ownership.
NZ Post said it now wanted to focus on its core delivery business, which has evolved considerably since establishing Kiwibank as an ancillary financial services unit in the early 2000s. It also recognised that the bank’s continued growth would rely on further capital investment.
NZ Super will receive NZD 527m for its 25% stake while ACC will accept NZD 464m for its 22% holding. NZ Post is also making a full exit, selling the balancing 53% for an implied NZD 1.1bn.
NZ Super and ACC invested NZD 325m and NZD 285m, respectively, across two transactions in 2016 and 2017, with both investors maintaining their 25% and 22% positions. As part of the 2016 transaction, NZ Post agreed to re-invest NZD 90m of its proceeds back into Kiwibank.
Kiwibank says its total assets have grown by almost 50% since 2016, when it had 800,000 customers, 250 post office shops, and a nationwide ATM network. The bank describes its current customer base as including more than 1m individuals and 40,000 businesses.
Services cover personal and business banking as well as international transactions, foreign currency accounts, home loans, sustainable energy loans, and various business services. Revenue increased 18% during the 2022 financial year to NZD 680m, while profit improved 4% to NZ$165 million. This compares to revenue of NZD 477m and profit of NZD 124m in 2016.
“We initially considered buying some or all of NZ Post’s stake and discussed this matter with the government, but ultimately weren’t able to get agreement on two key issues relating to the asset. Specifically, we sought the flexibility to introduce private sector capital and governance capabilities into the business, and as a wholly commercial investor we sought to preserve all options for exiting the investment in the future,” NZ Super CEO Matt Whineray said in a statement.
“These requirements understandably did not fit with the government’s objective for the ownership of Kiwibank.”
NZ Super has more than NZD 8bn invested in the country, with substantial exposures to technology, financial services, healthcare, land and housing development, timber, listed equities, and private companies. Private equity represented about 4% of the portfolio as of mid-2021.
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