The super merger buzz in 1H23

With mergers and consolidation activity at a record high for Australia’s superannuation industry, Money Management rounds up all the merger talk so far in the first half of 2023.

In the previous year, there were over 10 mergers and acquisitions, such as Cbus Super and Media Super, Hostplus and Statewide Super, HESTA and Mercy Super, CareSuper and Spirit Super, and QSuper and Sunsuper (now known as Australian Retirement Trust), to name a few.

In 2023, while there are a handful of confirmed mergers, there is plenty of talk about exploring potential mergers in the months ahead. 

January 

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The year began with more than 80,000 members from Australian Catholic Superannuation (ACS) joining UniSuper through a completed merger. It brought $10 billion in funds to UniSuper, which had over $105 billion in assets. 

At the end of January, the Australian Institute of Superannuation Trustees (AIST) and Industry Super Australia (ISA) confirmed they were exploring the possibility of a merger. In a joint statement to Super Review, the two organisations said: “As part of their commitment to act in members’ best interests, ISA and AIST are exploring a merger to create a single voice for profit-to-member super funds in Australia.”

February 

AvSuper and Commonwealth Super Corporation (CSC) announced they had scrapped discussions about a potential merger. The two funds had entered into a memorandum of understanding in May 2022 and had been conducting due diligence to determine if a merger was in the best interests of their respective members. This had taken place over the past few months that the funds said had been “thorough, co-operative, and a valuable experience”. However, it was concluded the process would be too complex to enact.

Instead, AvSuper decided to explore a merger with ART that it expects to complete by the first quarter of 2024. 

March

Shortly after announcing a possible merger with AvSuper, ART announced it has signed an MOU with Alcoa Super, its third merger possibility behind AvSuper and Commonwealth Bank Group Super. The fund is seeking to target $500 billion in assets under management.

April

In early April, Mercer Super Trust completed its merger with BT to create a $63 billion fund. The combined fund would now have 850,000 members. The move followed Mercer’s acquisition of Advance Asset Management the same month to expand its investment multi-manager capabilities. 

Mine Super and TWUSUPER, which signed a memorandum of understanding in December 2022, said they had progressed to the next phase towards creating a combined fund with nearly $20 billion in funds under management. They had executed a heads of agreement in a continued commitment to the merger process.

May

Cbus welcomed some 17,000 members through a merger with EISS Super, bringing its assets under management to over $80 billion on behalf of 900,000 members. The funds had first signed a formal agreement to merge in September 2022. It marked Cbus’ second merger to be completed in the past 13 months, following a merger with Media Super in April 2022.

Mid-May, Mercer Super announced it had acquired the Holden Employees Superannuation Fund (HESF). This is its third following the fund’s merger with BT Super in April 2023 and Lutheran Super in August 2022.

June

At the beginning of the month, Spirit Super and CareSuper announced they had entered into a binding agreement to merge following an extensive due diligence process. Expected to be completed in late 2024, the merger would result in a $50 billion combined fund with over 500,000 members.

The next day, industry super fund-owned IFM Investors and property platform ISPT confirmed they are exploring the merits of a potential merger at the request of significant shareholders.

Vision Super and Active Super also announced they had signed a merger heads of agreement, creating an entity with $27 billion in funds under management and 170,000 member accounts.