Industry superannuation fund-owned global private markets manager, IFM Investors, and Nest, the largest UK pension scheme by members, have entered a binding agreement that, subject to satisfaction of certain conditions, will see Nest take a 10% ownership stake in IFM parent company Industry Super Holdings and commit to significant ongoing investment.
Nest will join IFM’s existing 16 Australian industry super fund owners, becoming the only non-Australian shareholder in IFM’s 30-year history.
Nest manages retirement savings of over £48 billion on behalf of over a third of UK workers. IFM’s existing owners manage retirement savings of over A$1 trillion on behalf of over half the Australian workforce, reinforcing IFM as a leading collectively-owned manager for pension funds and their members.
This strategic partnership is built on a shared purpose to invest, protect and grow the long-term retirement savings of working people.
The agreement with Nest is expected to support IFM’s growth and diversification strategy, with Nest:
Making foundation investments to launch three new IFM private market strategies in infrastructure equity, infrastructure debt and private equity over the next 12-18 months, and
Providing presumptive foundation support on an ongoing basis for new IFM strategies over the years and decades to come and considering IFM as a preferred investment service provider for private market investments.
Nest’s ambition is to invest around £5 billion via IFM managed investments by 2030, across real assets and private markets as well as co-design new investment opportunities in infrastructure and private equity. Investing in private markets requires special expertise and scale.
Many pension and superannuation funds view the IFM model as a successful model for alignment of purpose in the investment management industry. IFM is a leading example worldwide of a collective vehicle owned by pension funds.
Since 2019, Nest has been increasing its exposure to private market assets to help its members improve their retirement outcomes and is stepping up plans to increase its private markets allocation from 17 to 30 per cent. IFM will provide Nest with investment capabilities and expertise across a range of private market investments, as it has with Australian industry super fund owners for the last three decades.
The agreement highlights the increased scale and opportunities that can be leveraged through collectively owned managers, as well as a laser-like focus on risk-adjusted returns driven by a shared purpose and strong cultural alignment.
Nest intend to work with IFM to develop new investment strategies to invest in IFM’s infrastructure, debt, and private equity capabilities – with a key focus on new UK investment opportunities. Nest members will also benefit from IFM’s existing deal sourcing and operational capabilities in the United Kingdom.
IFM and the UK Government have a Memorandum of Understanding targeting £10 billion pounds of investment by IFM in the UK by 2027. IFM launched a UK energy blueprint with Nest, and other UK pension and Australian super funds recommending targeted policy action to unlock pension capital to contribute to the new UK Government delivering on its clean power by 2030 mission.
The completion of the transaction is subject to certain conditions, including regulatory and shareholder approvals, which Nest and IFM anticipate being satisfied before the middle of 2025.
Quote attributable to IFM Investors Chief Executive, David Neal:
“IFM is owned by some of the fastest growing pension and super funds in the world, who recognise the advantages to members when they invest in private markets through a collectively-owned manager. This alliance will support IFM’s further expansion into new investment opportunities and markets across the world, especially in the UK, and give Australian workers greater access to global markets that have the potential to deliver risk-adjusted returns for their retirement.”
Quote attributable to Mark Fawcett, CEO of Nest Invest:
“Nest is proud to be recognised as an international player within the global pensions industry. By joining forces with IFM, one of the world’s leading infrastructure managers, we are taking a crucial step towards our goal of investing 30% of our assets under management (AUM) into private markets by 2030. We’re excited to leverage IFM's expertise and scale to unlock more private market opportunities that can drive stronger returns for our members. With £10 billion of our AUM already invested in the UK, our goal is to grow this to £20 billion, and our partnership with IFM will be instrumental in helping us get there.”
Quote attributable to IFM Investors Chair, Cath Bowtell:
“This strategic relationship with Nest reflects the scale of the Australian super system and further demonstrates the influence it commands around the world. This is a significant milestone in IFM’s history, and it has come about because of the shared purpose and values of IFM, the industry funds, and Nest – to invest, protect and grow the long-term retirement savings of working people.”
Quote attributable to Nest Chair, Brendan McCafferty:
“At Nest, we believe that no investment opportunity should be out of reach for everyday pension savers.
“Our new partnership with IFM demonstrates our ongoing commitment to using every tool in our toolbox to boost our members’ risk-adjusted returns. Together with IFM, we’ll be able to further enhance our sophisticated investment options for everyday UK pension savers, aiming to help them build a more secure retirement.
“With more than a third of the UK workforce saving with Nest, access to more private investment opportunities will allow us to increase investment into our members' jobs, communities, and essential infrastructure, like roads and bridges.”
Notes to editors
About IFM Investors
IFM Investors was established more than 30 years ago with the purpose to invest, protect and grow the long-term retirement savings of working people. Owned by Australian pension funds, the organisation has approximately A$230 billion under management as at 31 December 2024. Because IFM is owned by industry pension funds, we prioritise the interests of 745 like-minded investors worldwide by focusing on assets that combine excellent long-term risk/reward characteristics with broad economic and social benefits to the community. Operating globally from offices in Melbourne, Sydney, London, Berlin, Zurich, Amsterdam, Milan, Warsaw, New York, Houston, Hong Kong, Seoul and Tokyo, IFM manages investments across infrastructure equity, debt, listed equities and private equity assets. For more information, visit www.ifminvestors.com.
About Nest
Nest was set up by the government to give every UK worker somewhere good to save after the introduction of auto enrolment. Since then, it’s grown to become the largest workplace pension scheme in the country with more than 13.7 million members. One in three of the working population is expected to have a Nest pension pot by the late 2020s.
Nest’s members benefit from an award-winning investment strategy and one of the most diversified DC portfolios in the industry. It practices responsible investment that aims to deliver long-term growth while carefully managing risk.
Nest safeguards over £48 billion assets on its members’ behalf. It takes around £500 million a month in new contributions, and that figure is expected to rise. By the end of the decade Nest will have close to £100bn invested on its members’ behalf.
Contact details:
For media queries for IFM, please contact:
Australia: Patrick Lane +61 437 884 010, [email protected]
For media queries for Nest: please contact:
Sarah-Rose Burke +447939 828 803, [email protected]
Mira Millane +447771 542460, [email protected]