Household Capital gains L&G, super funds support

Household Capital chief executive Josh Funder says the specialist local retirement funding provider’s partnerships with local super funds and Britain’s Legal & General will supercharge its plans to deliver $1 trillion of funding into the Australian retirement funding system. At a recent round table forum convened by Household Capital, executives of industry super giants AustralianSuper, HESTA and Cbus all agreed that the family home should become a significant part of Australia’s retirement funding solution. The superannuation industry is focusing much more closely on the pension phase of retirement, rather than simply the accumulation phase.

The federal government has included home equity in the terms of reference for its current inquiry, chaired by former Treasury ­bureaucrat Mike Callaghan, into the retirement savings system.

Household Capital is chaired by Garry Weaven, the former chairman and founder of IFM Investors and former chairman of Industry Super.

L&G’s Retail Retirement division has purchased a 20 per cent stake in Household Capital by anchoring an $18m Series B financing for the Australian firm, which also introduced venture capitalist and Computer Power Group founder Roger Allen as an investor. Mr Allen built Computer Power, which counted media mogul Robert Murdoch as its largest investor, into one of Australia’s first global IT computer businesses.

The strategic investment is L&G’s first in Australia for 32 years following the $892m sale of its local business to Colonial Mutual in 1998. “L&G have led the explosion in the UK in delivering billions of dollars of home equity. We expect very much to learn from their experience in transforming the availability of retirement funding,’’ Mr Funder said.

“We think we can deliver $1 trillion of home equity into the Australian retirement funding system and L&G have recognised that.”

Following the deal, L&G’s Natasha Mora will join the Household Capital board of directors.

L&G’s move brings to $25m the total amount of equity capital raised by Household Capital since launching in 2017.

Its other backers include ME Bank, barrister Allan Myers, former federal super minister Nick Sherry, former Macquarie Group executive Jim Miller, former Skilled Group CEO Greg Hargrave and other private investors.

The firm has previously established a $100m wholesale debt ­facility with ME Bank to provide funding for home equity.

Mr Funder said the funds raised from the company’s Series B raising round would be used to grow staff numbers, increase marketing and expand its offering of hi-tech home equity retirement funding.

Original article on The Australian