The struggling AMP has admitted that its businesses are not performing under their current ownership and has responded to pressure from unsolicited buyers and will look at possible spin-offs, sales, or demergers.
The approach, which has been hinted at recently by some analysts and fund managers, emerged in a statement from the board yesterday.
As a result, the company (which only lost its chair and a director a fortnight ago) has appointed a team of consultants and lawyers to explore options for its businesses.
The news saw the shares rise 4.8% to $1.62.
AMP claimed it was committed to its existing strategy, including restructuring its wealth management arm to simplify products and growing its asset management business AMP Capital by expanding its private markets business.
“However, AMP periodically receives unsolicited interest in its assets and businesses, and recently has experienced an increase in interest and enquiries,” AMP said in a statement to the ASX on Wednesday.
“The board has therefore decided to undertake a portfolio review to assess all opportunities in a considered and holistic manner, evaluating the relative merits as well as potential separation costs and dis-synergies, with a focus on maximising shareholder value.”
Credit Suisse, Goldman Sachs, and King & Wood Mallesons have been appointed as advisers to manage the review.
Newly-appointed chair Debra Hazelton reiterated support for AMP’s strategy, including the pivot to private markets in AMP Capital – the business that has been enveloped in scandal leading to the demotion of its chief executive Boe Pahari after then chair, David Murray and director ZJohn Fraser quit late last month.
Pahari’s appointment to run AMP Capital in May triggered an outburst after it become known the company had promoted him despite a sexual harassment allegation against him in London being substantiated in an investigation.
“However, we have taken a decisive step to undertake a portfolio review to ensure we appropriately assess all options to maximise shareholder value in a considered and disciplined manner,” Ms. Hazelton said in Wednesday’s statement.
AMP Capital with more than $192 billion in assets and investments is the key asset and the one the likes of global giants such as Blackrock, Blackstone of the US will covet.
It is the sort of asset that Australia’s huge industry fund groups would want as well.
