Equipsuper has withdrawn from merger plans with Vision Super, stating it would not be in members' best interests.
The fund withdrew after the pair failed to reach an agreement following 12 months of negotiations. Equipsuper said Vision Super failed to agree to prearranged requirements centred around the Equipsuper investment model.
An Equipsuper representative said the Euipsuper board felt the merger was unworkable without the investment model, as the synergies, benefits and savings sought by the merger would be lost.
Equipsuper said the benefits of economies of scale found in a merger between the funds could only be possible with a board that was "collaborative and effective" and committed to its investment model.
"Over the past 12 months, the board of Vision Super has failed to meet key dates, provide essential information and has breached or continuously sought to change several key parts of our Memorandum of Understanding and Shareholders' Deed," Equipsuper chair Andrew Fairley said.
Issues in negotiations came to light last May after Equipsuper released a statement saying Vision Super board members were unable to sign off on previously agreed governance issues.
Despite this, in July, Fairley and Vision Super chair Darren Cochrane confirmed the merger would go ahead.
The merger would have created a super fund with almost $10 billion in assets and 160,000 members, making it amongst the 10 largest superannuation funds in Australia.
Equipsuper said that after investing a significant amount of time and resources, it did not have confidence that the merger was in the best interests of its members.
It said that while rationalisation of the industry was the way forward, any future merger plans would need to align with members' best interests.
