Equity Trustees has transferred administration of Small APRA Funds (SAF) – a portfolio of more than 400 funds and $600 million of assets – to SuperConcepts.
Equity Trustees, however, remains the trustee for these funds through its registrable superannuation entities (RSE) licensee held by subsidiary Equity Trustees Superannuation Limited.
This marks the completion of one of two key strategies that the firm outlined in its bid to achieve synergies when it acquired AET from SFG Australia, a whole subsidiary of Insignia, for a total cash consideration of $135 million.
At the time of acquisition, Equity Trustees announced its intention to exit AET’s platform business – comprising SMSF administration and custody, platform management services (PMS), SAF administration, and custody – and also outsource the administration of the SAF portfolio.
In August, the superannuation trustee business confirmed that it had entered into an enterprise service agreement with SuperConcepts to take on the clients of the platforms business, ensuring they continue to receive specialist superannuation and platform services.
According to the firm, these changes are a “critical driver” of achieving its previously announced $2.9 million net expense synergy.
“We will be working closely with SuperConcepts, and advisers and clients of the platforms business to ensure the process, and any options available to them, are clearly communicated and the transition process is efficient,” Mick O’Brien, Equity Trustees managing director, said last year.
“In line with our core capability, Equity Trustees will continue to have a role by providing SAF trusteeship through our superannuation licensed entity (Equity Trustees Superannuation Limited) and the provision of select non-standard asset custody for the SAFs (via another Equity Trustees subsidiary).
“We are pleased to have reached an arrangement with the market-leading provider of administration services, which is an excellent outcome for clients of this part of the AET business. For Equity Trustees, the exit from the platforms business enables us to maintain our focus on our core business of trustee services.”
Equity Trustees also confirmed on Wednesday that the exit of the platform business, through a progressive wind down, is “well advanced” and expects to achieve a net cost synergy of the originally estimated $3.5 million per annum.
“We confirm the previously announced expected revenue synergy of $5.8m per annum run rate in FY25, capital release of $10m expected by the end of the calendar year contingent on court approval and within the implementation budget of $22 million,” the firm said.
