04/03/2020 - 15:50

WA Super pursues new merger

04/03/2020 - 15:50

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National superannuation giant First State Super and smaller Perth-based fund WA Super have signed a memorandum of understanding to evaluate the benefits of a merger.

WA Super pursues new merger
Fabian Ross says WA Super has been actively seeking a culturally-aligned merger partner. Photo: Attila Csaszar

National superannuation giant First State Super and smaller Perth-based fund WA Super have signed a memorandum of understanding to evaluate the benefits of a merger.

Sydney-based First State has $105 billion in assets while WA Super has $4 billion.

The two industry funds said they would enter a due diligence phase, with the process expected to be completed mid-year.

They said the proposed merger supported national growth for First State Super and would improve services and support for members of both funds in Western Australia.

First State and its financial planning business StatePlus already have a presence in WA with 8,000 members and clients.

The merged fund would have around 60,000 members in WA.

In a statement, the two funds said they remained committed to providing local service and support in WA.

Today’s announcement comes nearly a year after WA Super signed a similar MOU with South Australia-based Statewide Super and Tasmania-based Tasplan Super.

That merger, if it had proceeded, would have created a fund with around $23 billion in assets and 347,000 members.

It also comes two years after WA Super completed a merger with fellow WA superannuation fund Concept One.

WA Super chief executive Fabian Ross said the fund has been actively seeking a culturally-aligned merger partner. 

“We recognise in the current superannuation environment that size can make a difference,” he said.

“With size comes scale, which can have a significant impact on our members’ fees, returns and ultimately their long-term retirement savings. 

“As such, we have determined that a merger with a like-minded super fund would add value not only to our members, but to Western Australians too, as it would enhance the delivery of financial services and education across WA. 

“Rather than sitting back and waiting to see what is going to happen, it is important that we work in our members’ best interests. We have chosen to take a pro-active stance by considering how we can achieve the benefits that size and scale can bring, with the right merger partner.

“Should this merger proceed, the outcome would be to provide our members with the knowledge and reassurance that their retirement savings will be in safe hands, and that First State Super will continue to help them achieve the retirement dream they want and deserve.”

 

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