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Case study: Navigating one scheme’s integration post-acquisition
We acquired the Atlas Master Trust in 2021, and we're using the experience we gained to ensure that the next consolidation goes as smoothly.
Case study: Navigating one scheme’s integration post-acquisition
To ensure the efficient transition of all underlying schemes, our Client Relationship Management team embarked on a two-year exercise, designed to leave no stone unturned.
Scheme profile
- Size: £39M
- Client within the Atlas Default Investment Option
- 75+ touch points with SEI over 24-month transition period
Lessons learned
To ensure the efficient transition of all underlying schemes, our Client Relationship Management team embarked on a two-year exercise, designed to leave no stone unturned. We are able to use the experience we have gained so far to ensure that the next consolidation goes as smoothly.
As master trust consolidation continues, at SEI, we are able to use the experience we have gained so far to ensure that the next consolidation goes as smoothly. Our ‘lesson learned’ discussions from our first consolidation highlighted three important insights.
Client engagement requirements
Firstly – know that voluntary consultation with clients/participating employers takes time. Whilst using the triggering event is always an option for consolidation, we wanted to ensure that we took our clients with us on the journey, rather than impose change on them.[ Within any master trust there is a range of participating employers with a variety of governance styles and interest in their pension arrangements.] As we know many employers chose a master trust arrangement to reduce the pressure of governance, so it was important to engage with clients early and often to ensure their understanding of, and support for, the process. We needed to be very clear on the benefits of change for both the members and their employers, initially and over the longer term, and ensure a consistent message. Regular communication and engagement from the very first messages, in addition to managing the BAU activity for these clients, was time consuming but created significant payback in terms of ensuring that over 95% of clients voluntarily joined the consolidated SEI Master Trust.
Governance from trustee
We needed to ensure we had the right governance framework in place from Day 1, to avoid any conflicts of interests, so that the Trustee could be confident it was - at all times - acting in the best interest of the members of both Master Trusts. So we setup a Merger sub-committee from the point of acquisition, appointing the former Chair of the acquired Master Trust as Chair of that committee. The Merger sub-committee was responsible for comparing and contrasting every aspect of the two Trusts, from governance and administration, through to communications and investments. It could then make ‘Best of Breed’ recommendations to the Board, with all parties confident the needs of all members were being fully represented, and that they would all benefit from ‘the Best of Both’ within the consolidated master trust.
Liaising with the third-party administrator throughout
Master Trust Consolidation can bring some great benefits for clients and members. The economies of scale alone can bring significant cost savings which can then be passed directly onto the members. But the promise of ‘good things to come’ would soon be forgotten if our service levels had slipped in the meantime. So it was hugely important to plan ahead and allocate resources accordingly. To achieve a good outcome for all, we ensured ‘business as usual requirements’ were delivered by our core administration team, with client specific projects and new client implementations handled by a separate and dedicated resource. That enabled us to focus on consolidating the two Trusts, without fear of disappointing either new or existing clients and members in the process.
Interested in finding out more?
When one master trust acquires another, there are necessarily a lot of moving parts. And whilst the process may eventually lead to improvements—as was the case for our client in the example above—it can just as easily lead to disillusionment. For consultants and schemes alike, working alongside a provider with a robust transitions process remains key.
To find out more about our master trust and approach to client management, contact one of the team today.
1Source: SEI, Atlas. As at 31 December 2023. ‘Fee’ is defined as the master trust single total expense ratio (TER), inclusive of all master trust services.
2Source, SEI, as at 31 December. For illustration only. SEI simulated glide-path analysis to demonstrate how member outcomes would change in different market environments. Expected risk and return projections using SEI Capital Market Assumptions. Asset class assumptions are set using a combination of empirical and forward-looking analysis and are designed to be long-term in nature. Assumptions include estimates of annual return, volatility and correlations by asset class, as well as prospective ranges for these values over various time horizons.
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This case study describes the attributes of a specific client that SEI has determined is comparable based on objective criteria, including organisational goals, assets size and industry sector. Any discussion of specific asset allocations is intended to help clients understand SEI’s customised investment approach, and should not be regarded as a recommendation. Information concerning SEI’s recommendations over the last year is available on request. The information express herein represents the current, good faith views of SEI at the time of original publication, and has not been updated.