Equip Super and TelstraSuper sign binding Heads of Agreement to proceed with merger

The Boards of Equip Super, which oversees Catholic Super, and TelstraSuper have signed a binding Heads of Agreement to proceed with a ‘merger of equals’ between the two funds. The binding agreement follows the earlier signing of a non-binding Memorandum of Understanding and due diligence process confirming the merger is expected to be in the best financial interests of members of each fund.

The merger will create a combined profit-to-member fund with more than $60 billion in funds under management and over 225,000 members. Equip Super will be the go forward brand, with the TelstraSuper brand to be retired in due course.

The merged fund will have combined strengths in member and employer servicing, retirement planning, investments and tailored corporate arrangements (including management of defined benefit plans), and retain strong connections to its heritage industries and connected communities.

It is expected that the merger will achieve significant scale benefits and deliver improved retirement outcomes to the members of each fund, whilst maintaining the personalised service that each fund currently delivers. Members will receive a reduction in the asset-based administration fee to 0.15% and a reduction in the administration fee cap to $750 p.a. from the effective date of the merger of the two funds.

The merged entity will leverage TelstraSuper’s operational capability and digital experience to service and support members.

The merged entity’s Board will comprise an equal number of legacy TelstraSuper and Equip Super directors. The equal representation model will be maintained with 2 independent directors, 4 employer-representative directors and 4 member-representative directors. The board will have the expertise and experience required to take the merged fund forward.

Michael Cameron (current Equip Super Chair) will be independent Chair of the new fund’s Board and Anne-Marie O’Loghlin (current TelstraSuper Chair) will be independent Deputy Chair.

“It is a privilege to be named the inaugural Chair, as Equip Super and TelstraSuper come together to form a new fund that will deliver scale benefits to our members, including an immediate fee reduction at the time of the merger,” said Cameron. “With a best of breed approach, we will maintain the personalised service both funds are known for, and bring to market leading products, services and capability.”    

TelstraSuper Chair Anne-Marie O’Loghlin said “The agreement to merge follows a rigorous assessment by the Trustee Board of a variety of merger options that were available to TelstraSuper. This coming together signifies a new chapter of growth, strength, and enhanced services for both Funds’ members. With shared values, strong defined benefit experience, and a passion for financial advice, we look forward to building a united Fund in the best interests of members.”

Chris Davies (current TelstraSuper Chief Executive Officer) will be the inaugural CEO of the new fund. Scott Cameron (current Equip Super Chief Executive Officer) will be the Deputy CEO, focussing on merger integration.  Once the operational integration of the two funds is complete to the satisfaction of the merged entity’s Board, the parties intend that Scott Cameron will succeed Chris Davies as the Chief Executive Officer of the new fund. 

The funds will continue to operate independently until the merger is executed via a Successor Fund Transfer, which is expected to occur in late 2025. It is anticipated that operational integration will be substantially complete around the end of 2026.  The two funds will keep members, employers and other stakeholders informed as the merger progresses.