AXA Mulls NAB Counter Bid For AXA APH
December 17 2009 - 4:43AM
Dow Jones News
French insurance company AXA SA (AXA) said late Thursday it was
considering National Australia Bank Ltd.'s (NAB) surprise A$13.3
billion bid for AXA Asia Pacific Holdings Ltd. (AXA.AU) that could
trounce an existing offer from AMP Ltd (AMP.AU).
"AXA will review the situation, in light notably of the
exclusivity agreement between AMP and AXA," it said in a statement,
adding that it hadn't been in contact with NAB so far about its
proposal.
AXA is locked into exclusive talks with AMP until Feb. 6, but
analysts say the big attraction of the NAB offer is that it has
already won the support of key AXA APH independent directors who
this week rejected an improved AMP offer.
"AXA takes note of the offer made by National Australia Bank
Limited (NAB) to the AXA APH committee of independent directors and
of the committee's rejection of the revised proposal put forward by
AMP and AXA on Dec. 12," AXA said.
AMP's revised offer was valued at A$12.85 billion.
Pierre Flabbee, a Paris-based analyst at Kepler Capital, said
AXA will most likely go for the NAB bid: "The most important
element is that the new offer can be taken in cash and for that
reason has won the support of AXA APH independent directors. AMP
said its recently sweetened offer was final so it's unlikely it
will come back with anything better."
At 0850 GMT, AXA shares were up 0.5% at EUR16.37, outperforming
the Stoxx Europe 600 insurance index, which was up slightly.
If NAB's bid is successful, it plans to offer AXA APH's Asian
wealth businesses to AXA.
AXA APH Chairman Rick Allert said: "The independent board
committee has unanimously concluded that the NAB proposal is in the
best interests of AXA APH minority shareholders and superior to the
rejected AMP, AXA SA revised proposal, in both its value and
terms."
AXA SA owns 53.9% of AXA APH.
The acquisition of AXA APH would propel either AMP or NAB into
clear market leading positions in the Australasian life insurance
and wealth management sectors, and give them the largest network of
financial advisers in Australia.
AXA APH's Allert said at a media briefing that other undisclosed
parties had also expressed interest in AXA APH since AMP's first
proposal nearly six weeks ago, indicating that the battle for the
company may be far from over.
Under both proposals, AXA SA would acquire the Asian operations
of AXA APH for A$9.13 billion, helping it build its operations in
the region, but only under the NAB proposal would all minority
shareholders have the chance to take a full cash payment in return
for their shares.
NAB's deal also values AXA APH's Australian and New Zealand
wealth management businesses at A$4.61 billion, against the A$4.41
billion AMP is willing to pay under Monday's sweetened bid.
In a statement, AMP said its exclusivity agreement with AXA SA
gives it "time to carefully consider its position." NAB said its
offer stands until Feb. 16 or six weeks after any decision by AMP
to end the exclusivity period.
AXA APH is the only Australian financial services firm with the
majority of its business in Asia and has exposure to eight regional
markets, which account for two-thirds of its earnings.
-By Digby Larner, Dow Jones Newswires; +33 1 4017 1748;
digby.larner@dowjones.com
(Lyndal McFarland and Bill Lindsay contributed to this
item.)
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