NRFC invests $200M in Macquarie Group’s cyber capabilities

The National Reconstruction Fund Corporation (NRFC) will make a $200 million hybrid note investment in ASX-listed cloud, cybersecurity, and telecoms provider Macquarie Technology Group. The NRFC is a sovereign investor established by the Australian Government to invest in Australian businesses to support nationally significant technological innovation, digital infrastructure, defence and national security. It aims to transform industrial capability, create high quality jobs and diversify Australia’s economy.

This investment will help ensure that critical digital infrastructure and information, including the data of everyday Australians, remains securely onshore, says the NRFC in a media release.

Its investment falls under the NRFC’s Enabling Capabilities Priority Area, which involves helping to deliver national capabilities that Australian companies and businesses need to compete and win in the emerging digital economy, NRFC adds. The investment delivers on key parts of the NRFC mandate, delivering increased national resilience in the face of growing global uncertainty and creating high quality jobs.

In January the NRFC announced it would invest some $75 million in Australian space company Gilmour Space Technologies; it has also invested $10 million in Hypersonix Launch Systems and $150 million in ASDAM, which owns, among other companies, Quickstep and Marand.

Macquarie Technology Group was founded in 1992 by Australian brothers David and Aidan Tudehope. It provides sovereign cloud, cybersecurity services and AI infrastructure to customers including Australian businesses, critical infrastructure sectors, and government agencies. The company’s integrated technology stack – combining software, platform assembly and operations – enables customers to securely store, process and protect sensitive data within Australia.

“Our investment in Macquarie Technology fits squarely within NRFC’s mandate by building the country’s digital industrial capability, enabling enhanced competitiveness and productivity for a wide range of Australian companies across multiple sectors of the economy,” said David Gall, NRFC’s CEO.

“NRFC’s investment will help to provide many small to medium sized Australian companies with the cybersecurity capability they need to compete and win work in areas where information security is a requirement for entry.”

Investing in Macquarie Technology also strengthens Australia’s cybersecurity defences, and ensures that mission-critical digital infrastructure remains onshore, he added

Macquarie Technology provides secure cloud and cybersecurity infrastructure to a large number of Australian government agencies. The NRFC’s investment will support the company’s expansion of sovereign cloud services, the development of AI-enabled cybersecurity capability, and the fit-out of a new sovereign data facility.

It also supports execution of the Federal Government’s National AI plan, which aims to deliver digital infrastructure to create an AI-enabled economy that is more competitive, productive, and resilient.

The NRFC has a mandate to invest across both debt and equity and to find new ways of financing businesses with innovative financing structures. The NRFC’s investment in Macquarie Technology will be provided by way of a first-of-its-kind hybrid note for an unrated company, combining both debt and equity features.