Consolidation is continuing in the industry superannuation funds sector with Kinetic Super and Sunsuper boards signing an in-principle agreement to merge and create a $45 billion giant.
Pending successful completion of a comprehensive due diligence process, the funds will look to commence a full merger later in the year.
The Boards of Kinetic Super and Sunsuper said they believed the merger will be in the best interests of members.
Kinetic Super chairman, Frank Gullone, said combining the funds would not only achieve further economies of scale in the form of lower fees, but would also accelerate the delivery of enhanced services and products to all members.
“The two funds are highly complementary and share similar values. We are united by our profit-for-member model and unfaltering focus on maximising members’ retirement savings within a low-cost and transparent structure,” Mr Gullone said.
“Our employers will also benefit from an expanded suite of services and highly digitised delivery,” he said.
Sunsuper chairman, Ben Swan, said that with a strong cultural fit between Sunsuper and Kinetic Super, the proposed merger represented a fantastic opportunity to leverage the strengths and capabilities of both organisations for the benefit of their members and employers.
“We are delighted to have entered into discussions with Kinetic Super. With the shared objective of always acting in our customers’ best interests, a successful merger will drive future efficiencies, promote a stronger competitive position in the market, and ultimately generate greater value for the combined member and employer base,” Mr Swan said.
The funds said a final decision to merge had not been made at this stage as both funds need to exchange information through the due diligence phase, however both boards were committed to the successful conclusion of the merger.
The combined fund would consolidate its position as one of the nation’s biggest superannuation funds, with more than $45 billion in funds under management, 1.3 million members, and over 100,000 employers.