Australia’s Qantas Super retirement system is poised to merge with A$300 billion ($201.8 billion) industry fund Australian Retirement Trust, the Qantas Super board confirmed on Wednesday.
Subject to a final assessments of members’ best financial interests and equivalency rights, the merger would see Qantas Super’s A$9 billion ($6.05 billion) in funds under management and 26,000 members transfer to ART.
Qantas Super officials explained the merger is part of its efforts as a trustee to assess current performance and anticipate future challenges and opportunities. As a result, the trustee board decided to explore a merger with another super fund due to considerations of scale, legislation and regulation, as well as long-term sustainability.
According to Qantas Super, the organization has comprehensively assessed the different merger options available to it as superannuation industry consolidation continues, including remaining as an independent corporate super fund.
The fund ultimately chose ART because it is “one of the largest defined benefit administrators” and has the expertise to “administer a complex fund like Qantas Super,” which comprises defined benefit and accumulation divisions.
Merging with ART will give Qantas Super members access to competitively priced products and services, a broader choice of investment options and enhanced member support and services, including digital and education tools, seminars, and advice, according to Qantas Super.
ART is also “a fund that works for members, not shareholders, and which is focused on lower fees,” Qantas Super added.
Qantas Super Chair John Atkin said that, throughout the process of exploring merger options, ART has demonstrated a “strong commitment to taking care of our members and their financial interests. We believe that ART will be the right partner to help our members feel confident in their financial future so they can look forward to retirement.”
He added that Qantas Super has had the privilege and responsibility of managing the superannuation and retirement savings of its members for 85 years, and selecting the right partner was a responsibility the trustee board took “extremely seriously.”
ART Chair Andrew Fraser said both funds are deeply committed to doing the right thing by their respective members.
“We will work towards a merger together,” Fraser said. “The merger will proceed if we believe it is in the best financial interests of members.”
This article initially appeared in our sister publication, Financial Standard, which, like CIO, is owned by ISS STOXX.
Tags: Andrew Fraser, Australian Retirement Trust, John Atkin, Mergers and Acquisitions, Qantas Super