National Australia Set for Paris Talks With Axa, Herald Reports

Feb. 6 (Bloomberg) -- National Australia Bank Ltd. and French insurer Axa SA are set to begin talks this weekend on a possible agreement to acquire and split up Axa Asia Pacific Holdings Ltd., the Sydney Morning Herald reported.

National Australia may have sent a negotiating team to Paris ahead of the expiry today of an exclusivity agreement between AMP Ltd. and Axa that prevented the French company from teaming up with a rival bidder, the newspaper reported, without saying where it got the information. National Australia declined to comment.

After increasing their share of Australia’s housing loan market throughout the global financial crisis, the nation’s banks are now snapping up asset managers in a country that dodged the global recession.

“The likeliest outcome is that National Australia’s offer will be accepted by Axa,” said Chris Weston, an institutional dealer at IG Markets in Melbourne. “It’s still not certain that regulators would accept the deal, but it’s clear that the ball is now firmly in AMP’s court.”

In December, National Australia Bank Ltd. bid A$13.3 billion ($11.5 billion) for Axa Asia Pacific, scuttling AMP Ltd.’s joint offer with Axa, and winning approval from the wealth manager’s independent directors.

Conditional Offer

The bank offered A$6.43 a share for Axa Asia Pacific, beating the A$6.22 bid by AMP and Axa, which owns 54 percent of Axa Asia Pacific. The deal is conditional on Axa’s agreement to buy Axa Asia Pacific’s units in eight Asian countries.

National Australia Bank is paying A$4.6 billion for Axa Asia Pacific operations in Australia and New Zealand, adding to assets acquired in its purchase of Aviva Plc’s local units in June. National Australia Bank’s managed assets in Australia and New Zealand would swell to A$144.3 billion if the deal is completed. Axa, France’s biggest insurer, would win full control of its business in Asia, where wealth is growing faster than in any other region.

National Australia Bank declined to comment on the speculation that talks with Axa will take place this weekend in Paris.

“We don’t comment on speculation of this nature,” said George Wright, a Melbourne-based spokesman for the lender.

Axa Asia Pacific said Feb. 3 that total funds grew 7 percent in the second half of 2009 from six months earlier amid a recovery from the financial crisis.

“We performed strongly in 2009 with growth in most of our businesses,” Chief Executive Officer Andrew Penn said in a statement. “This was against the background of a difficult year for our industry with the impact of the global financial crisis affecting investor confidence and reducing industry sales in many of the markets in which we operate.”