The AMP hasn’t forgotten about AXA Asia Pacific, judging by the frequent references to the proposed merger at yesterday’s AGM, but it has to wait to see what its rival bidder, the NAB, does.
While the NAB has been blocked from bidding for AXA AP by the ACCC, the Melbourne-based bank has been making noises about recasting its $14 billion offer to try and take into account the regulator’s concerns.
So far we’ve seen no public manifestation of that new approach from the NAB.
National Australia Bank’s $14 billion bid for AXA was blocked by the ACCC on April 19, and since then NAB has maintained that it is exploring its options.
The ACCC said it opposed the bank’s proposal on competition grounds, but did not oppose AMP’s bid.
The NAB has till the end of the month to convince the regulator to change the ‘no’, or it could see its agreement with AXA Asia Pacific and parent, AXA SA lapse, just as the AMP offer lapsed after the NAB overbid it.
The AMP’s chief executive, Craig Dunn, said yesterday a merger with AXA Asia Pacific Holdings remains attractive but there was still some way to go before the issue is resolved.
He told shareholders at the AGM yesterday that AXA remained strategically attractive to the AMP.
AMP was pleased with the decision of the ACCC to block National Australia Bank’s rival bid for AXA, he said.
"We were pleased that the ACCC decided that competition in the Australian financial services sector would be best served by our proposal," Mr Dunn told shareholders.
"Our immediate focus is to work through the relevant regulatory matters."
But growth by mergers and acquisitions is not a strategic necessity for AMP, he said.
"Our primary focus is to grow through a series of change initiatives to revitalise AMP, with new and more competitive products and funds, new services and new ways to do business with us."
Chairman, Mr Peter Mason, was on the same wavelength, telling the meeting earlier, "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.
"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."
Mr Mason also had some kind words about the federal government’s proposed changes to superannuation (which as a big fund manager and seller of super products pleased him).
"The Government recently released the final outcomes of the Ripoll and Henry reviews, and I am very pleased to report that our determination to anticipate the changing expectations of the government and consumers means we believe we’re well prepared.
"Indeed, we are ahead of the changes announced in the Government’s Future of Financial Advice reforms.
"From 1 July this year, we will have removed in-built commissions in our contemporary superannuation, pension and investment products – two years ahead of the deadline for the rest of the industry, and all the aligned planners in our networks will be working on a fee-for-service basis for that business.
"The transparency in the pricing of our products and advice will also help enhance our customers’ confidence in what we have to offer and how we can help them.
"We are also very encouraged by the Government’s strong commitment to superannuation as the main form of retirement saving in Australia.
"The Government has determined to increase the superannuation guarantee from nine per cent to 12 per cent, and this will ensure all Australians have substantial retirement savings, at a time when developed nations around the world grapple with the challenges of supporting ageing populations.
"As announced last November, AMP has already taken the initiative to increase superannuation contributions for our staff to 12 per cent by 2014 – five years ahead of the Government’s timeline."
AMP shares rose 17c to regain the $6 level. They ended at $6.01, up nearly 3% on the day.
