The National Australia Bank has pulled the plug on its $13.4 billion takeover of AXA Asia Pacific.
In a statement to the ASX last night, the bank said the termination of the agreement followed the decision by the Australian Competition and Consumer Commission last week (ACCC) not to accept the proposed enforceable undertakings offered by NAB and AXA APH.
That was delivered last Thursday by the Commission and was the second rejection of the NAB takeover since it was launched late last year.
The way is now open for the AMP to reactivate its interest and $12 billion offer that started the whole affair when launched on November 9, 2009.
But that offer price would have to be increased to around the $13.4 billion the NAB offered to get the AXA board interested.
"Although we are disappointed with the decision of the ACCC, we have a strong position through MLC and NAB’s other wealth management businesses," NAB group chief executive Cameron Clyne said in the statement.
"NAB remains very committed to participating in the wealth management industry which is an important part of the banks future.
"However, considering all the options, continuing with this agreement is not in the best interests of shareholders."
AXA chairman, Rick Allert said in a separate statement, “We note NAB’s decision to withdraw their proposal to acquire our Australian and New Zealand businesses and accordingly the agreements have been terminated.
“Throughout the period of discussions, our senior management and staff have remained focused on growing our businesses throughout the Asia-Pacific region.
"AXA APH is a first class operator in some of the most resilient and fastest growing markets for financial services in the world.
"The Directors remain very confident about the future and we look forward to continuing to deliver shareholder value.”
NAB shares ended steady on $25.22 yesterday, AXA shares fell 4c to $5.18 (the NAB bid was at $6.43 a share) and the AMP’s shares rose 3c to $5.08.
NAB shares are up 38c since last Thursday when the ACC announced the second rejection, AMP shares are up 4c and AXA shares have risen 10c.
All are sharply lower since the AMP and NAB launched their bids last November/December.
NAB faced opposition apparently from some major shareholders about the wisdom of pursuing a bid for AXA.
It would have involved legal action against the ACCC, more time and money, for no certain outcome.
Now the AMP has to face a similar set of challenges from its shareholders if it should choose to relaunch it bid.
It has to be lower than the previous offer of $12 billion, otherwise its shareholders will get upset.
But AXA AP’s board won’t wear a cut price bid.
Quite a few brokers have said in recent days that they see the AMP returning with a new offer.
But they are talking their book. A lot od hedge funds have bought into AXA.
Will the AMP bid and bail them out?
