National Australia Bank (NAB) unveiled a surprise US$11.9 billion bid for financial services group AXA Asia Pacific’s Australian and New Zealand businesses yesterday, trumping a rival offer.
NAB, Australia’s third-largest bank, agreed key terms with AXA Asia Pacific (APH), elbowing out the earlier bid by fund manager AMP. The deal is subject to AXA’s French parent AXA SA taking over its Asian businesses.
“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 Asia Pacific chairman Rick Allert said.
The announcement came just days after AMP and AXA SA announced a sweetened A$12.85 billion (US$11.7 billion) offer, intending to carve up the firm’s Australasian and Asian operations.
NAB must now convince the French parent company, which owns 53.9 percent of AXA Asia Pacific, to dump AMP and back the new proposal, Dow Jones Newswires reported.
Either NAB or AMP stand to become Australia and New Zealand’s leading wealth management group, while AXA SA would gain a valuable presence in Asia.
Under the new deal, AXA Asia Pacific shareholders can receive either A$6.43 per share or A$1.59 and 0.175 NAB shares. AXA closed at A$5.65 on Wednesday.
NAB said it would offer new shares worth A$1.5 billion to help fund its latest push into the financial services sector, after acquiring Aviva Australia and forming a strategic alliance with JB Were.
“The proposed merger of our wealth business and AXA Australia and New Zealand would combine two successful and highly complementary businesses,” NAB chief executive officer Cameron Clyne said.
There was no immediate comment from AMP, which has set its sights on becoming the “fifth pillar” in the Australian financial sector alongside the big four banks.
“I’d like to think that we’ve got a great Australian company buying back the farm,” AMP chief executive Craig Dunn told public radio last month.
AXA SA released a statement saying it “takes note” of the offer, but denied any contact with NAB.
“AXA and its advisors have had no contact or discussions with the National Australia Bank regarding their proposal,” the company said.
NAB shares slumped 4.65 percent on the news as analysts cast doubt on the deal’s immediate value to shareholders. AXA shot up nearly 13 percent to A$6.37 yesterday and AMP rose more than four percent to A$6.35.
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