AXA welcomes today the end of the pricing period of the merger of AXA Asia Pacific Holdings.
with AMP Limited and the sale of AXA APH’s Asian business to AXA. The acquisition of AXA APH’s Asian business by AXA is expected to close on April 1, 2011.
The transaction previously received all necessary shareholder and regulatory approvals.
“We are particularly pleased to announce that we are about to close the AXA APH transaction,” said Henri de Castries, Chairman and Chief Executive Officer of AXA. “Our Asian Life & Savings operations were among the fastest growing within the Group in 2010 with very strong new business profitability. This strategic transaction allows us to reinforce our growth profile with a significant increase in our exposure to high growth markets and is fully consistent with our ambition to combine value and growth through an effective capital management strategy.”
Taking into account the reference AMP 10-day Volume Weighted Average Price (“VWAP”) of A$5.32, the final consideration to be paid to AXA APH minority shareholders comprises 0.73 AMP shares and A$2.5464 in cash per AXA APH share.
AMP will acquire 100% of AXA APH’s outstanding shares for A$ 13.3 billion. AMP will buy AXA’s shares in AXA APH for A$ 7.2 billion in cash. As part of the transaction, AXA will acquire from AMP 100% of AXA APH’s Asian operations for A$ 9.8 billion in cash. AXA APH’s Australia and New Zealand businesses price will be A$ 3.5 billion.
The net cash payment by AXA will be A$ 2.6 billion (or ca. Euro 1.8 billion1).
The transaction is expected to be accretive on underlying earnings per share in 2011. The following estimated impacts on AXA are also expected in 1H 2011:
– Ca. Euro 0.7 billion2 exceptional gain in net income related to the disposal of Australia & New Zealand operations
– -1 pt on Solvency I ratio, which was 182% at December 31, 2010
– +4 pts on debt gearing, which was 28% at December 31, 2010. This impact is mainly due to the net cash payment and to a decrease in shareholders equity of ca. Euro 1.6 billion.
New management structure in Asia
Effective immediately following closing of the transaction, John Dacey, a member of the AXA Group Executive Committee, will assume the new role of Vice-Chairman for Asia Pacific, reporting to Henri de Castries. In this position, he will focus on the continued expansion of AXA’s businesses in the region. He was previously Chief Executive Officer of AXA’s Japan & Asia Pacific business unit, which will be restructured into AXA Asia and AXA Japan.
Mike Bishop, a member of the AXA Group Executive Committee, is appointed Chief Executive Officer of AXA Asia, reporting to Henri de Castries. Mike was previously CEO of AXA Asia Life, a division of AXA APH.
In his new role, he will continue to head AXA’s Life & Savings business in Asia (China, Hong Kong, India, Indonesia, Malaysia, the Philippines, Singapore and Thailand) and will manage the development of AXA’s P&C business in this region (China, Hong Kong, India, Indonesia, Malaysia, Singapore, Thailand and Vietnam). Gaëlle Olivier, the new Chief Executive Officer of AXA Asia P&C, will report directly to Mike.
Jean-Louis Laurent Josi, Chief Executive Officer of AXA Japan and a member of the AXA Group Executive Committee, will report directly to Henri de Castries.
After 20 years of service, Andrew Penn, Chief Executive Officer of AXA Asia Pacific Holdings, has decided to leave the Group.
“On behalf of AXA’s Board of Directors and Management Committee, I would like to thank Andy Penn for his contribution to the development of AXA’s franchise over the years in Asia, Australia and New Zealand. I wish him the very best in all his future endeavours.
I would also like to thank John Dacey for his work in structuring the region and for his key role in the AXA APH transaction. I look forward to continuing working with him on the expansion of our operations in Asia.
I am very confident that Mike Bishop and Jean-Louis Laurent Josi will benefit from the engagement and the quality of their teams to develop further the business in the region and accelerate growth”, said Henri de Castries, Chairman and Chief Executive Officer of AXA.
Source : AXA Press Release