HESTA and Mercy Super, two Australian superannuation funds with a focus on health-care sector employees, said Tuesday they intend to merge by year's end via a successor fund transfer that would see Mercy Super's 13,000 members join HESTA's 930,000 participants.
The combination of Melbourne-based HESTA's roughly A$68 billion ($49 billion) in retirement assets with Brisbane-based Mercy Super's A$1.7 billion would create a fund with just under A$70 billion, "delivering benefits of scale to members," according to a HESTA news release.
The move, subject to due diligence by both sides, would be in keeping with the accelerating consolidation trend of recent years, which Australian regulators contend should provide better retirement outcomes for participants on the strength of the stronger investment outcomes and lower fees that scale can provide.
A separate announcement by Mercy Super said, "We've always put the interest of our members first and believe it is now time … to benefit from being part of a larger fund." Many of Mercy Super's members work at Brisbane's Mater Hospital and other Sisters of Mercy organizations, with the announcement citing HESTA's deep links to the health-care sector as a factor that led Mercy Super to enter into exclusive talks to merge.
