Superannuation funds are expected to assert greater dominance and influence over M&A activity next year. The report Top trends from 2025 and outlook for 2026 from law firm Minter Ellison expects the $4.3 trillion superannuation industry will have a greater role as they seek higher returns for members.
While funds did not lodge public bids for ASX-listed entities this year, it is “inevitable” they will have to do so going forward, the law firm said, especially for the mega funds with more than $100 billion in assets under management.
This includes funds such as Australian Super, Australian Retirement Trust, Aware Super and Cbus Super.
“While super funds did not lodge public bids for ASX-listed entities in 2025, the sector’s scale — now exceeding $4.3 trillion in funds under management — makes it inevitable that super funds will return to play an active role in future public M&A transactions as they seek higher returns through direct investment strategies rather than relying solely on traditional asset classes.”
The approach to this M&A activity could take two forms; independently or via a consortium.
“We expect super funds will pursue targets both independently (as we saw with Australian Food Super’s unconditional on-market takeover bid for Dynamic Group Holdings Ltd in 2024) and via the more traditional approach of bidding as a consortium member (as adopted by HostPlus when it teamed up with Charter Hall to acquire Hotel Property Investments, also in 2024).
“Continued consolidation within the superannuation sector will further concentrate capital and increase the number of funds capable of executing large-scale public transactions.”
The report also noted that as their AUM grew, super funds were becoming more vocal about the intentions as shareholders and were unafraid to speak out against M&A bids for their holdings.
In particular, Minter Ellison referenced the public objection statements from Australian Super towards the proposed acquisition of Origin Energy by Brookfield and EIG in 2023. The super fund, which is Australia’s largest fund, felt the offer for Origin was too low and undervalued the company. Due to the fact Australian Super was the largest shareholder, its lack of approval meant the deal fell through as it was unable to secure 75 per cent support of shareholders.
“Shareholder activism played an influential role in public M&A outcomes this year and we expect will remain a significant force in 2026. One of the core drivers of such shareholder activism is the growing sophistication and assertiveness of hedge funds, superannuation funds and other institutional investors.”
