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1 March 2011

NO.014

AMP's Proposed Acquisition of AXA Asia Pacific

Today I am announcing approval of the proposed acquisition by AMP Limited (AMP) of the Australian and New Zealand businesses of AXA Asia Pacific Holdings Limited (AXA AP), with appropriate conditions, under the Financial Sector (Shareholdings) Act 1998 (FSSA).

My decision follows a thorough assessment of the likely impact on the Australian national interest, particularly the need for a strong, stable and competitive financial system that provides families and small businesses with confidence and choice.

The combined strength of AMP and AXA AP, with a larger consolidated balance sheet and broader capital base, will allow the merged entity to compete vigorously with the major banks across both the Australian wealth management and banking sectors.

The Treasury advises that the merger will enable greater investment in AMP Bank, enhancing its ability to compete further in the mortgage market.

I am imposing strict conditions on the acquisition to ensure the best possible outcomes for affected AMP and AXA AP employees.

This decision takes careful account of the detailed assessments of the Australian Competition and Consumer Commission, the Australian Prudential Regulation Authority, the Australian Securities and Investments Commission and the Department of the Treasury.

I am advised that the proposed on-sale by AXA AP of its Asian assets to AXA SA does not require approval under the Foreign Acquisitions and Takeovers Act (1975) or the Government's foreign investment policy, principally because these Asian assets do not constitute an ‘Australian business' within the meaning of that Act. AXA SA is also not proposing to increase its current shareholding in AXA AP.

I consider, however, that the proposed acquisition would be in the Australian national interest within the terms of the FSSA, which applies the same high threshold for approval.

APRA has also advised that approvals are not required under the Insurance Acquisitions and Takeovers Act 1991 for the proposed transaction.

Approval of the proposed acquisition under the Financial Sector (Shareholdings) Act 1998 is conditional upon the agreement of the shareholders of AXA AP to the proposal and the endorsement of the relevant scheme of arrangement.

CANBERRA
1 March 2011

Attachment A

Conditions Attached to Approval Under the Financial Sector (Shareholdings) Act 1998
of Proposed Acquisition by AMP Limited of AXA Asia Pacific Holdings Limited Australian and New Zealand Businesses

The conditions to which this approval is subject are that as part of the implementation of the proposed merger, AMP Limited, as part of any reorganisation of the AMP Group's activities, is required to:

  1. maximise internal redeployment opportunities available to affected staff, support external jobs placement where employee redundancies occur, and ensure that staff affected by the merger have timely access to their full entitlements under the AMP Limited and AXA Asia Pacific Holdings retrenchment arrangements;
  2. work through implications for employees as quickly and sensitively as possible, in consultation with employees, the Finance Sector Union and other affected stakeholders;
  3. provide specialist resources to assist staff affected by the merger.

Force Majeure

AMP Limited will not be liable for any failure to perform any obligations imposed by these conditions if the failure is due to Force Majeure.

If AMP Limited is by reason of Force Majeure unable to perform an obligation under these conditions, AMP Limited will soon as practicable and in any event within 30 days notify the Deputy Prime Minister and Treasurer specifying:

  1. the cause and extent of non-performance;
  2. the date of commencement of Force Majeure;
  3. the means proposed to be adopted to remedy or abate the Force Majeure;

and will use all reasonable diligence and employ all reasonable means to remedy or abate the Force Majeure as expeditiously as possible.

Force Majeure means:

  1. any act of God;
  2. war, revolution, or any other unlawful act against public order or authority;
  3. an industrial dispute; or
  4. a government restraint.

This approval remains in force indefinitely.