Equip has taken a slice of Qantas Super’s corporate super pie, inking a $190 million deal to look after the retirement future of more than 1000 of the airline’s former catering employees.
In April 2018 Qantas announced plans to sell it’s catering business to one of the world’s largest air services providers, Dnata, but the benefits and members will be transferred from the Qantas Super fund across to Equip.
Equip’s chief executive, Nicholas Vamvakas, said Dnata’s superannuation plan included a mix of defined and accumulation accounts.
Qantas’ catering businesses included wholly-owned subsidiaries Q Catering Limited and Snap Fresh Pty Limited. Q Catering has centres in four Australian ports – Sydney, Melbourne, Brisbane and Perth, with its largest airline customer being Qantas.
This comes as the corporate super sector begins to fracture in the wake of damaging revelations about retail funds at the banking royal commission.
Last week, investment bank Credit Suisse said a concern for retail super providers was that “any reputational damage is likely taking a longer period to manifest”, with the corporate super sector to be hard hit in the months ahead.
In October, AMP lost its contract with Australia Post, following news that it had only weeks earlier lost another client – the $250 million Anglican National Super Plan – to Mercer.
“Retail corporate super funds have now shifted into outflow, with likely further outflows to come,” Credit Suisse analyst James Cordukes said in an investor note.
According to KPMG’s Super Insights Report 2018, the corporate sector will experience little or no growth from now until 2028, when it is projected it will hold $76 billion. In comparison, the wider super sector is expected to be worth $5 trillion by 2028.
“The banking royal commission has increased the number of discussions in corporate superannuation and we are anticipating a significant amount of movement in the sector over the next twelve months,” Vamvakas said.
“Equip will be an active competitor for business that it believes will benefit its members by keeping costs as low as possible while extending the fund’s capabilities and services to support retirement outcomes.”
In mid-2017 Equip and the Rio Tinto Superannuation Fund merged, with the name Equip continuing and members swelling to over 75,000.
“Winning the trust and confidence of Dnata and its employees so soon after completing the merger with the Rio Tinto staff fund is great recognition of our capacity to maintain ‘Top 10’ investment performance while transitioning members smoothly into our fund,” said Vamvakas, whose appointment was announced at the same time as the merger announcement in June 2017.
Dnata is headquartered in and operates 11 catering facilities in Australia, currently trading under the dnata catering brand (recently rebranded from Alpha Flight Services). dnata employs more than 4000 people in Australia across its catering, cargo and ground handling businesses.