Super fund invests in a new strategy

The NZ Super Fund has made its first investment into a merger arbitrage strategy.

Tuesday, March 1st 2016, 9:14AM

The NZ Super Fund has appointed a subsidiary of Ramius LLC, the global investment management business of Cowen Group, Inc. (Nasdaq: COWN), to manage a US$200 million merger arbitrage mandate.

The mandate focuses on investment opportunities arising through merger and acquisition transactions, predominately in listed companies in North America and Europe.

This is the NZ Super Fund’s first investment in merger arbitrage, a strategy which aims to earn steady returns over the long-term by realising value from targeted merger and acquisition deals across a broad cross section of industries, and managing any risks, including the potential for any individual deal failure.

NZ Super Fund chief investment officer Matt Whineray says merger arbitrage is designed to achieve a premium return over the long term. “The NZ Super Fund’s long investment horizon means it is in a good position to take advantage of the returns offered by merger arbitrage. Ramius’s specialist skills and track record complement our investment priorities and return objectives.”

Thomas W. Strauss, chairman of Ramius, and Michael Singer, Chief Executive Officer of Ramius, said, “We are extremely pleased to be working with the NZ Super Fund. Together, we have worked diligently through the evaluation process to ensure that our merger arbitrage strategy meets the objectives of the NZ Super Fund as a long-term, growth-oriented fund. The NZ Super Fund, which was named by JP Morgan in 2015 as the world’s best-performing sovereign wealth fund, is a world-class organisation and we are very proud to be a part of the team.”

The appointment is effective March 1.

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