Australia's NAB mulls 'all options' on AXA

12th September 2010, Comments 0 comments

National Australia Bank (NAB) said "all options" were on the table regarding takeover target AXA Asia Pacific and it was close to deciding whether to push ahead with its failed bid.

NAB's 12.2 billion US dollar offer for AXA's Australia and New Zealand businesses was rejected by competition officials for a second time Thursday over fears it would shrink the local financial services industry.

Analysts expect NAB to walk away from the bid because AXA's value has slipped since the initial offer, but bank spokesman Steve Tucker said it was still mulling whether to make a court challenge or further amendments.

"All the options are being considered at this stage," Tucker told ABC television.

"That's the sensible thing to do, just to take our time and think it through, and we'll make a pretty timely decision over the next few days."

Tucker said NAB had done "quite a lot" to try to address the concerns of Australia's Competition and Consumer Commission (ACCC) since it knocked back the bank's initial offer in April, and it disagreed with the second rebuff.

"You have to be careful to get the balance between satisfying the concerns of the ACCC and keeping the integrity of the value of the deal in place," Tucker said.

"We thought we'd done that with a good package. We were disappointed to get the no decision."

ACCC deputy chairman Peter Kell said AXA was emerging as a "vigorous and effective competitor" and the merger would have "taken them out of the picture."

Kell said NAB's offer to divest key technology did not go far enough because the bank would still have taken AXA's distribution network and products and benefited from the "significant investment" it had made building a profile.

Under the arrangement, French parent company AXA SA would have taken charge of its subsidiary's Asian arm, while NAB would control the Australian and New Zealand businesses.

Rival suitor AMP made an initial 11.5 billion US dollar offer which was elbowed aside by NAB, and it has said it still considers the deal "strategically attractive" at the right price.

Kell said the ACCC didn't "have the same competition concerns about AMP," and would not oppose its bid.

"But ultimately whether AMP wants to take some further steps now is entirely up to them," he said

© 2010 AFP

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