In a move seen by some as a precedent for other state-based funds to follow, the A$3 billion (US$3.04 billion) Westscheme will merge into AustralianSuper, taking that fund up to the A$40 billion mark.
Perth, Australia-based Westscheme will roll into Melbourne-based AustralianSuper from July 1 this year, I&T News understands, with a report from PricewaterhouseCoopers to the Western Australia fund’s board understood to be the catalyst.
That report is understood to have said members’ best interests would be served as part of a larger fund.
Warren Chant, principal of superannuation research and consulting firm Chant West, said the move was not surprising and that this rollover could pave the way for other state-based multi-industry funds — ASSET in New South Wales, Statewide in South Australia, Tasplan in Tasmania and Sunsuper in Queensland — to also rollover into, or merge with, AustralianSuper.
“Why wouldn’t they get together? The Cooper review has thrown the spotlight on scale, and AustralianSuper is really just the national version of what all these other funds are doing on a state level,” he said, referring to a comprehensive review of the country’s superannuation system.
It’s understood that Westscheme’s board considered a rollover or merger into SunSuper before taking this alternative course of action.
Calls to AustralianSuper’s chair and CEO had not been returned at press time, while Westscheme officials would not comment.
Michael Bailey is editor of I&T News, Sydney.