Axa drops £1.3bn Asia Pacific move

INSURER Axa today pulled out of its A$3.3bn (£1.3bn) offer for the remaining 48.3% of Axa Asia Pacific after independent directors of the Australian unit said the bid was too low.

Axa, owner of PPP and Axa Sun Life in the UK, initially offered A$3.75 a share in cash and shares and lifted that to an all-cash offer of A$4.05 last week.

Europe's biggest insurer by sales, Axa owns 51.7% of the Melbourne-based arm and wanted to take over the rest as the basis for a renewed drive in Asia where it derives more than half its income.

But in Melbourne today, Axa Asia Pacific chairman Rick Allert said the improved offer, which values the company at some A$7bn, was 'insufficient' on the basis of optimistic projections.

In a statement released in Paris, Axa said its conditional proposal to acquire the minority interests in Axa Asia Pacific was now 'withdrawn and terminated'.

Relations between the two firms remain cordial.

In a letter to Axa chief Henri de Castries, Allert noted the 'constructive spirit' of takeover talks.

Axa Asia Pacific shares fell about 8% in Sydney to A$3.78 following the announcement of Axa's withdrawal.