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Local private equity investor partners with MMC

NZ private equity investor, Pencarrow, has taken a 50 per cent stake in Auckland-based fund administration firm MMC via a new investment vehicle.
In a deal confirmed last week, the Pencarrow Bridge Fund completed its first investment with the purchase of a half-share in the MMC holding company for an undisclosed sum.

Nigel Bingham, Pencarrow executive director and co-owner, said in a statement it would be “business as usual” for MMC clients following the sale with day-to-day operations to continue as previously. Bingham said Pencarrow fully-supported the current MMC management and strategic direction, which has built strong relationships with a diverse clientbase.

“We are excited about the opportunity to partner with MMC. Pencarrow invests in established New Zealand based companies that offer a clear and sustainable competitive advantage – something we see in MMC,” he said in the statement. “We are active and supportive investors, and will be partnering with Rob [Moss], Tom [Reiher] and senior management to define the vision, planning and execution of the company’s strategic direction and to help make the particular decisions required for that direction to succeed.”

In the release sent to clients, Robert Moss, MMC managing director, said the firm was “delighted” with the Pencarrow deal following a competitive sales process that had attracted global interest. “We believe that Pencarrow offered MMC the best strategic choice and we are thrilled to have them as a key shareholder in the business,” Moss said.

He said Pencarrow would take up two seats on the MMC board, which would add further depth and new insights as the firm continued to develop its growth strategy. From a standing start in 2004, MMC now boasts more than $27.5 billion under administration covering 26 clients while adding a range of services to its fund admin product suite, including, most recently, KiwiSaver registry. Moss said while MMC had seen “incredible growth” over the last 12 years, the business sought a strategic partnership to build on its success.

“With access to a wide and knowledgeable resource base, which will be available for us to tap into, Pencarrow will be a strong and supportive partner of MMC in the next stage of our growth,” he said.

The Wellington-based Pencarrow is New Zealand’s longest-running private equity firm, investing more than $300 million in about 30 companies since inception in 1993. Pencarrow has attracted funds from a number of highprofile institutional investors including the New Zealand Superannuation Fund and the Government Superannuation Fund.