Shareholders in takeover target AXA Asia Pacific could be excused for feeling a little confused after yesterday’s annual meeting in Melbourne.
As a result, any shareholder looking for a guide or an update as to where the one live bid from the NAB stood, would have been disappointed.
And they would have been mystified as to why the company was being sold, given the bullish comments about its growth in Asian markets, which will be sold to the France parent, AXA SA in any deal.
But AXA AP won’t decide on what to do with the blocked bid from the NAB until after May 31.
Some more light may be shed today or tomorrow when the competition regulator, the ACCC, is expected to release more details on the reasons why it stopped the NAB offer, and why it didn’t block the AMP offer (which has now lapsed).
The ACCC blocked the NAB offer after the ACCC said it would reduce competition in the retail investment platform. (NAB has the Navigator platform it picked up when it bought the local business of Aviva last June, and AXA has its growing North platform business. The ACCC concluded NAB could not have both.)
"If a satisfactory conclusion is not reached by 31 May, your independent directors can then decide whether or not to terminate the agreement made to implement the NAB proposal," chairman, Rick Allert, told the meeting.
"I am still unable to advise what the outcome of these discussions or actions may be.
"However, as ACCC approval is one of the conditions precedent in NAB’s proposal, if a satisfactory conclusion is not reached by 31 May, your independent directors can then decide whether or not to terminate the agreement made to implement the NAB proposal. NAB and AXA SA have the same right.
"Termination is not automatic and will only occur if one of AXA APH, NAB or AXA SA exercises that right.
"There has been some media speculation that AMP will make another proposal.
"In the event that any new proposal is received from AMP, or anyone else for that matter, your independent directors will consider it on its merits subject to any legal restrictions under the current agreement with NAB and AXA SA."
After the meeting Mr Allert told a media conference that the company had had discussions with the ACCC in the wake of the decision to stop the NAB bid.
He said he was surprised that the ACCC had knocked back NAB’s bid for AXA APH.
"We were surprised that they thought that was of sufficient merit to be anti competitive," he said of AXA APH’s North wealth platform product.
The ACCC said in its ruling that it was concerned competition and innovation would be harmed if NAB and AXA APH combined wealth platforms.
He said that NAB had discussed with the ACCC the potential sale of wealth management assets to enable its bid for AXA APH to be approved.
AXA AP’s agreement with NAB is due to expire on May 31, but Mr Allert told the media that it does not automatically terminate. He indicated the company would be prepared to extend the NAB agreement after considering the ACCC decision.
It was the address by CEO, Andy Penn that raised questions about why the Asian businesses were up for sale.
He said that in both Australia and New Zealand "we have continued to see the same trend as the second half of 2009 with modest growth in retail wealth management up 2 percent and 5 percent respectively.
"However, financial protection growth has continued to be strong in both markets up 12 percent and 19 percent.
"Our performance since the end of 2009 has also continued to be strong. Reflecting on sales for the first quarter in Asia we achieved very substantial growth up 57 percent across the region including a 17 percent increase in our largest business Hong Kong.
"There were very strong performances in South East Asia with the Philippines up 87 percent, Indonesia up 205 percent, Thailand up 88 percent, Singapore up 109 percent and Malaysia up 177 percent. Importantly recent market data indicates we are growing share in most of the markets in the region.
"In Hong Kong we have seen some very firm and encouraging signs in the latter part of 2009 and early 2010 that we are beginning to regain significant momentum in organic growth."
Hong Kong is the company’s biggest market in Asia.
