TelstraSuper has announced its intention to explore merger options as part of its long-term strategy.
In a statement on Thursday (2 May), the corporate fund said it is “currently in a strong and healthy position” with positive net member growth, high member advocacy, and a growing retirement segment.
“After careful consideration of the fund’s long-term strategy where size and scale are increasingly important, the TelstraSuper Board has determined that our members’ interests will be best served in the long term by seeking a suitable merger partner aligned to the Fund’s objectives and values,” it said.
Originally established in 1994 exclusively for employees of Telstra, the fund noted less than one-quarter of TelstraSuper members today currently work for the Telstra group of companies after it opened membership to all in 2022.
“As well, today many new members come directly to the Fund or through other unrelated employers and not through Telstra’s employment,” it said.
“The TelstraSuper Board and Telstra Group came to the view that the time has come for TelstraSuper to move forward with a new separate identity from the Telstra Group.”
Moreover, the fund’s current custodial contract is due to expire in 2025, it said, and it will need to move to a new arrangement by that time.
“Changing custodian is a significant task for the fund, and, again, a merger will facilitate the timely replacement of our current custodial arrangements,” TelstraSuper explained.
While it explores merger options, the fund confirmed there will be no change in its operations.
Last year, Qantas Super announced it was seeking a potential merger partner.
It explained that its readiness to explore a merger was prompted by a review of its scale and future prospects and the legislative and regulatory environment.
It also cited recent consolidations as having influenced its decision. Namely, as per Qantas Super’s statement, over the past two decades, the superannuation industry has been rapidly consolidating and the number of corporate superannuation funds has declined rapidly, going from 761 in 2004 to just 11 in 2022.
As of December 2023, the trustee board of Qantas Super had created a new merger committee – comprised of chair John Atkin, and directors Lorraine Berends, Luke Murray, Klair Safier, and Richard Garner – to guide the management team throughout the process.
It also met with various unions that count Qantas Super members among their members, with its various service providers, and the Australian Prudential Regulation Authority (APRA) on potential merger options.
