Australian superannuation funds MTAA Super and Tasplan have extended their deadline to complete a merger because of the covid-19 pandemic.
The funds had initially set a date of October 1, 2020 to complete their merger, after beginning talks in July 2019 to create a combined entity with more than A$24 billion ($14.7 billion; €13.3 billion) in assets under management.
The date has now been pushed back by more than six months to March 31, 2021 after a joint recommendation from MTAA Super CEO Leeanne Turner and Tasplan CEO Wayne Davy to the chairs of both funds’ boards.
In a joint statement, the funds said that “sustained market volatility” and “concerns about supplies of specialist services” were the main factors behind the decision.
MTAA Super’s Turner said that both funds remained “fully committed” to the merger, “just with an extended time.”
“Clearly things have changed rapidly for all Australians in the last few weeks. We recognize the pressure that this is putting on our members and on our staff, both at work and at home,” she said.
“We think extending the merger timeline will ease stress and help our staff better manage workloads and their personal arrangements.”
Tasplan’s Davy added that an extension would allow the individual funds to focus on providing members with support and advice over a period when many were likely to face financial difficulties.
“That’s always been important to us, but now it’s more important than ever,” he said.
MTAA Super is an industry fund that serves the motor trades and allied industries. It had approximately A$12.8 billion in assets under management at June 30, 2019. Tasplan is a multi-industry fund based in Tasmania that had approximately A$11.4 billion in AUM at the same date. Both are profit-for-member superfunds.
Tasplan has a single A$5 million investment in the agricultural sector, in a firm in Tasmania.
The merged fund would immediately place among Australia’s top 25 largest superfunds by AUM, according to the most recent statistics from the Australian Prudential Regulation Authority.