AMP’s latest bid to takeover AXA Asia Pacific Holdings’ (AXA APH) Australian and New Zealand businesses has been recommended by five of the six AXA APH Independent Directors.
Rick Allert, AXA AHP’s Chairman and one of the five directors recommending the proposal, said “AXA APH’s Independent Directors Committee has carefully and thoroughly examined the value and terms of the revised proposal.
… we believe the proposal is in the best interests of AXA APH minority shareholders
“A majority of the Independent Directors believe AMP and AXA SA’s proposal provides minority shareholders with appropriate value for their investment in AXA APH, supported by significant downside protection. As a result, we believe the proposal is in the best interests of AXA APH minority shareholders,” Mr Allert said.
The sixth Independent Director is seeking further information before determining a position on the proposal.
According to AMP’s Chief Executive Craig Dunn, in implementing a review of its financial services business in response to evolving consumer preferences and anticipated regulatory change, AMP has “… led the industry in delivering simpler, more affordable and contemporary products to our customers.”
“We are now in an excellent position to execute the integration of the AXA APH and AMP businesses to maximise the synergies and deliver real benefits to shareholders of both companies,” he said.
AMP’s previous takeover bids for AXA APH’s Australian and New Zealand operations were rejected by AXA’s Board because the offer was not perceived to reflect the asset value or growth potential of the company.
According to AMP, the current deal “… represents compelling value for AXA APH shareholders, who would receive a significant premium on the value of their shares along with the opportunity to participate in the ongoing earnings of a stronger and more competitive AMP.”
The new proposal promises minority shareholders the equivalent of $6.43 per share, up 21 cents on AMP’s earlier offer.
The merger proposal also follows a number of bids by the National Australia Bank (NAB), which were rejected by the ACCC.
Speaking in September 2010 about the NAB’s last bid for AXA, ACCC Deputy Chairman Peter Kell said “the proposed undertakings offered by the parties do not provide sufficient certainty that the ACCC’s competition concerns will be addressed.” However, at the time the ACCC did not rule out allowing a similar takeover bid from AMP to go through unchecked.
Mr Kell indicated that the ACCC may be willing to look more favourably on a bid from AMP as “… they don’t have the same type of platform presence that both NAB and AXA have.”
The current AMP proposal is still subject to satisfactory due diligence, execution of final transaction documents, approval by AXA APH minority shareholders and further regulatory approvals.
