AXA deal not a strategic necessity: AMP
A merger with AXA Asia Pacific is not a “strategic necessity” for AMP, though it would speed up its growth strategy if it goes ahead, according to group chief executive Craig Dunn.
Monday, May 17th 2010, 5:01AM
Dunn said at the annual meeting that "M&A activity can provide a useful means to accelerate our growth strategy, we don't see it as a strategic necessity."
Still, he said he was pleased the Australian Competition and Consumer Commission (ACCC) cleared the merger, and if it goes ahead, it "would certainly accelerate our growth strategy further."
The trans-Tasman financial services firm is waiting on the Commerce Commission to give the merger the tick after the ACCC blocked a rival bid by National Australia Bank which trumped the AMP offer for AXA AP's Australasian businesses. NAB is attempting to persuade the Australian regulator to change its mind.
Both AMP and AXA have wealth protection businesses in Australasia, and under the proposal, AMP would buy the Asia Pacific businesses, sell the Asian operation to AXA's French parent and keep the Australian and New Zealand units. The French parent owns 54% of AXA AP.
The Commerce Commission is due to make a decision on AMP's bid on May 14.
Peter Mason, AMP's chairman, said the banks are moving aggressively into wealth management, and are now the firm's "biggest competitors."
Mason said the company's merger and acquisition activity requires "patience and perseverance" to retain value for shareholders, and "is not something that we will rush."
"We believe we can put forward a proposal that is financially disciplined and will create value for AMP shareholders, and which the independent directors of AXA Asia Pacific will be able to recommend to their minority shareholders," he said.
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