Australian Catholic Super and NGS have announced they will merge into a consolidated $21 billion industry fund representing the community and non-government education sectors.
The tie-up between the two not-for-profit industry funds will bring together 85,000 members and $9 billion from Australian Catholic Super with 120,000 members and $12 billion in funds from NGS Super, subject to the usual due diligence and member benefit assessment provisions.
The merger announcement is the latest in a long line of amalgamations for sub-scale funds, a trend which has been encouraged by the Australian Prudential Regulator Authority, the Morrison Government, the Hayne Royal Commission and the Productivity Commission.
The fate of Australian Catholic Super has been a topic of industry speculation since its failed 2018 bid to merge with Catholic Super, which eventually merged with Equip Super in a $26 billion tie-up in May last year.
While Catholic Super’s merger with Equip Super used an extended public offer (EPO) model that allowed each fund to retain control of strategy, brand, board and staff while sharing administration and operations, there has been no word on the model preferred in the NGS and Australian Catholic Super merger.
If the traditional merger model is employed the executive shake-up will involve two of the most experienced names in the industry; Australian Catholic Super CEO Greg Cantor was appointed in 1989 and NGS Super CEO Laura Wright’s involvement in the fund stretches back to 1988.
The merger between the two education and community-minded funds is one of the more natural-fitting tie-ups to arise recently, especially when compared to fellow industry funds Cbus and Media Super, who are in the middle of diligence for their own $60 billion fund that would see the construction and media industry members come together.
Australian Catholic Super Chair David Hutton said the intention is to better service its members “within a larger like-minded education industry fund”, and that the merger represented a “great opportunity” to be part of a niche fund with a national footprint.
NGS Super’s Chair Dick Shearman touted the potential for the merger to enhance synergies between the two entities.
“Our members’ interests are at the core of this merger, which represents the continued growth and improved ability of our fund to secure the financial futures of all our members,” Shearman said.