Over a month of hard-nosed negotiations ended Monday night when France’s AXA agreed with the independent directors of its British affiliate Sun Life and Provincial Holdings to acquire the minority 43.74 percent it’s been seeking for 500 pence ($7.75) per share in line with analysts forecasts. AXA also agreed to pay a special dividend to minority shareholders of 5 pence (7.75 cents) a share.
The agreement frees AXA to consolidate its European holdings within the group, and to more fully integrate SLPH operations in Europe.
Although considerably more than the SLPH closing price of around $5 per share last March, when AXA first announced that it was seeking to buy out minority holders, it is still well in line with with the embedded value of the company, according to London analysts.
The move renews speculation that AXA may seek to acquire minority shareholdings in its other subsidiaries, notably AXA Financial in the U.S., which controls Equitable Life, the investment banking firm Donaldson Lufkin & Jenrette and asset manager Alliance Capital. AXA’s stake is currently 58 percent in AXA Financial, but the price wouldn’t be cheap given the sharp earnings rise (operating earnings up 61 percent in the first quarter) that it recently reported.
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