Stronger Super reforms and the push for scale have driven an alliance between global asset manager Russell Investments and administrator Link Group.
Russell and Link will join together to offer superannuation funds an integrated investment and administration platform, with Russell contracts passed over to Link along with 130 Russell employees.
Link will take on the administration duties for Russell’s standalone administration super clients, along with employer clients in the $5.3-billion Russell Super Solution Master Trust.
The new alliance will oversee $100 billion in superannuation assets and entrench Link’s competitive position in the administration sector as the Stronger Super reforms take hold.
Russell’s chief executive for the Asia-Pacific, Alan Schoenheimer, told I&T News the alliance was about creating “scale and sustainability” and spreading costs over a much larger market.
“Russell will keep the investment management piece and Link the member administration to create two players with significant scale,” Shoenheimer said.
He said that the alliance would present attractive outsourcing solutions to smaller superannuation funds under pressure to consolidate.
“They are under pressure to get their cost base down and this in some cases is leading to mergers,” Schoenheimer said. “We can now offer them the scale and volume they need.”
Link Group has grown by acquisition in the last few years, adding Australian Administration Services (AAS) in 2006 and then Future Plus last year.
Link customers currently include REST, TWU Super, Tasplan and CareSuper, providing services for the super accounts of 4 million Australians.
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