AMP makes renewed offer for AXA Asia Pacific

AMP has teamed with AXA SA of France in a renewed takeover proposal for Australia's AXA Asia Pacific, valuing the target at A$13.3 billion.

Monday, November 15th 2010, 3:51PM 5 Comments

by BusinessDesk

Under the proposed scheme of arrangement, minority shareholders of AXA AP would get at least A$6.43 a share in stock and cash, according to a statement from AXA AP. The offer is for 0.73 AMP stock and a variable amount of cash, based on the weighted average trading price of AMP's shares.

Shareholders of AXA AP would also be entitled to a final dividend of up to 9.25 cents a share, if such a payment is declared. They would not get AMP's final dividend payment.

Under the proposal, AMP would acquire all of AXA AP, merge its Australian and New Zealand operations with its own, and divest the Asian businesses to AXA SA. The target company's independent directors are reviewing the proposal and will provide an update to AXA AP shareholders once the review is complete.

AMP is renewing its efforts to acquire the rival after being trumped by a A$13.3 billion offer from National Australia Bank. The lender's proposal was subsequently knocked back by Australia's antitrust regulator.

Shares of AMP jumped 17 cents to $6.80 on the NZX on Friday. AXA AP was last at A$5.78 on the ASX, valuing the company at A$11.9 billion. The shares were halted today for the announcement.

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Comments from our readers

On 16 November 2010 at 10:54 am John said:
AMP seem to be very good at buying businesses but actually running them successfully is another matter entirely.
On 17 November 2010 at 8:07 am Kane said:
John is right, i think especially now as it seems the new gm in sales wants AMP to become a bank with little kiosks and pretty girls fluffing about. Moving toward transactions and away from personal relationships with clients... like the banks with their personal banker approach, they never last. It will cost them lots more to learn that this business IS and will remain about relationships!!
On 17 November 2010 at 2:48 pm John said:
100% agree with you Kane. AMP have always relied on "brand" to sell their life and investment products. Advisers also have traditionally been treated like employees when in fact (to quote another reader on here) they are the ones bringing the honey to the hive! Obviously AMP are going to apply for OFE status so I can't see this stance changing. The new players in the industry seem to value relationships. AMP as you've pointed out seems to think it knows best instead.
On 19 November 2010 at 9:36 am Kane said:
John, i remember hearing a fellow who has been in the insurance industry for many years constructively suggesting to some senior managers at the AMP that their ignorance is appearing as arrogance. They were to arrogant to get that!
On 19 November 2010 at 3:37 pm John said:
Sounds about right Kane. They don’t take constructive criticism well at all. Honestly I don’t actually know what some of their middle management staff do all day. Other insurers I work with are constantly out looking for new business leads or taking feedback onboard from advisers about how to improve their products and services to clients. AMP seem instead to “expect” to always get the business no matter what. Personally I’d say arrogance has now replaced ignorance.
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