National Mutual has formally taken over the management on MLC's operations in New Zealand and will continue to offer its funds to investors.
To mark the take-over the companies have announced the imminent launch of the MLC Investment Trust in New Zealand.
MLC New Zealand manager Andrew Kuruc says it is a self-contained 'shadow' fund of the Australian trust and it is designed for wholesale investors, primarily discretionary master funds and administration/wrap services.
He says the Australian Trust will still be available to retail investors.
Earlier this year NM and MLC's parent company Lend Lease agreed to partially merge their life insurance and funds management operations.
The combined group will have A$51 billion under management, making it the largest fund manager and second largest life insurer (after AMP) in Australasia.
Kuruc says the merger does not see the end of MLC in New Zealand, rather it strengthens its position.
MLC has been a fund manager in the New Zealand market since 1994 when it launched the MLC-Platinum Global fund. In 1996 it broadened its product range by offering its Australian-domiciled Property Securities and International Share funds and since then advisers and investors have also put money into the Australian Share, IncomeBuilder and Index funds.
Kuruc says NM and MLC are quite complementary. "By that I mean we are not clones likely to cannibalise one another when merging, resulting in an entity somewhat smaller than the sum of the two parts."
NM is strong in traditional markets, particularly mortgages and cash, while MLC's strengths are in equities and diversified managed funds.
"From a structural point of view it's David and Goliath. NM runs a larger, broad multi-channel business whilst MLC is a very focussed, lean operation."
Kuruc says NM's distribution is a godsend for MLC and it will enable it to distribute more of its funds.
He says the joint venture comes at a good time as MLC had made significant progress with limited resources, but it needed more firepower - which NM offers.
"NM's size gives MLC the opportunity to expand its business in New Zealand and push forward into the next millennium," he says.
Kuruc is returning to MLC's head office in Sydney and National Mutual's Jill Paterson will assume responsibility for MLC funds in New Zealand.
National Mutual has formally taken over the management on MLC's operations in New Zealand and will continue to offer its funds to investors.