Queensland based profit-for-members fund LGIAsuper has acquired national retail fund Suncorp Portfolio Services Limited (SPSL), a move which the funds say will deliver medium-term fee benefits to members.
With around $31 billion in member savings under management, the new 250,000-member fund incorporated LGIAsuper, Energy Super – which merged with LGIAsuper in July 2021 – and SPSL, with plans to ultimately mutualise the retail fund and put it back in the hands of the membership.
LGIAsuper chief executive, Kate Farrar, who led the merger and acquisition, said completing the transaction would enable the fund to grow and thrive in an increasingly complex and competitive national market.
“The acquisition of the SPSL business gives us the combined size and scale to deliver efficiently for all our members, while maintaining a personal and boutique member experience that differentiates us from the growing number of superannuation mega-funds,” Farrar said.
“This transaction is unique in that we are a profit-for-members fund acquiring a retail fund, with the ultimate intent being to mutualise the retail fund and put benefits in the hands of all members.
“The superannuation industry is consolidating rapidly, with merger and acquisition activity driven by a need to lower costs and improve service offerings to remain competitive and ensure we are acting in members’ best interests.
“We have a clear vision for our future together: to achieve a sustainable fund size that maintains our status as a boutique and personal superannuation provider whilst enabling us to deliver very competitive returns and fees,” she said.
Suncorp Wealth division’s executive general manager, James Gyton, said his appointment to the fund’s leadership team would assist with the integration.
“This is an exceptional opportunity for us to bring together the experience and knowledge of people from not only two teams but two fund types to enable us to deliver a unique offering that provides members with the best possible outcomes,” Gyton said.
Gyton would join the fund’s executive team as the chief operating officer for the SPSL business.
Farrar said Suncorp’s superannuation members would not see any short-term changes to services, with LGIAsuper and Energy Super initially operating the Suncorp fund as a standalone entity under the Suncorp brand.
Farrar said the investment, which was funded from LGIAsuper’s reserves, had a superb payback period which was well below equity market price/earnings ratios.
