Commonwealth Bank Group Super (Group Super) has entered into a memorandum of understanding to pursue a merger with Australian Retirement Trust (ART), Group Super’s trustee announced on Tuesday.
This merger would amount to more than $230 billion in funds under management (FUM), with Group Super’s 67,000 members and $12.3 billion FUM transferring to ART.
Group Super chair, trustee board, Rosemary Vilgan, said the fund members’ best financial interests are at the “heart” of everything it does.
“Though Group Super has delivered good outcomes for members over the years, we are still a relatively small fund, and we know scale is important to deliver long-term outcomes for superannuation fund members,” Ms Vilgan explained.
“As a large, well-established fund, Australian Retirement Trust can offer a broader range of products and services at competitive fee levels for members. We are confident that a merger would deliver value for our members leading into and during their retirement.”
The decision to explore options for a potential merger was inspired by successive federal governments emphasising the importance of scale in delivering long-term returns for members, Group Super explained.
ART’s chair, Andrew Fraser, said Group Super members would benefit from its ability to “leverage our scale to seek out world-class investment opportunities and deliver enhanced products and services to all of our members.”
“Our primary commitment is to ensure we act in the best financial interests’ of all members and the merger will only proceed if it is the best interests of current ART members and Group Super members,” Mr Fraser said.
The merger is subject to both funds completing their respective due diligence reviews, agreeing on the final terms of the merger, and relevant regulatory requirements being satisfied.
Moving forward, Ms Vilgan said the fund is “looking forward to working together with Australian Retirement Trust over the next 12 months as we complete due diligence and undertake the transition”.
“In the meantime, we remain committed to delivering quality service for all our members,” she concluded.