Report: National Australia Bank to Sell Assets for $13 Billion AXA Deal

By and | May 14, 2010

National Australia Bank, which has seen its $13 billion takeover bid for AXA Asia Pacific Holdings Ltd blocked by the competition regulator, is preparing to sell some assets to appease the government watchdog, two sources said.

NAB, staring at an end of May deadline for its agreement with AXA Asia and its parent AXA SA, is expected to submit a plan in the next 10 days that will outline measures aimed at overcoming the regulatory hurdles.

NAB could still wait for regulatory guidance on the blocked transaction, but Australia’s top lender is in the process of drawing up a divestiture plan to address the competition issues raised by the watchdog.

An NAB spokesman said the company was considering all options. The sources declined to be identified as the discussions were confidential.

“They are preparing an assurance to say we will sell the following investment platforms,” one source said, adding that NAB had a strong case to win the battle if it agreed to address the concerns raised by the Australia Competition and Consumer Commission.

PLATFORM SALES
NAB would offer to sell AXA’s Summit investment platform and close some of its own legacy platforms to appease the regulator, one source said. But NAB would not be willing to divest its Navigator and AXA’s North platform, the sources added.

The retail investment platforms enable people to manage their investments online, bringing together investors, their financial advisers and wealth managers.

NAB gained control of the Navigator platform through the purchase of Aviva Plc’s <AV.L> Australian businesses last year.

In a surprise move last month, the regulator blocked NAB’s planned takeover of AXA APH’s Australian assets, saying that would hurt competition by reducing the number of retail investment platforms in the market.

That decision by the regulator bolstered rival bidder AMP Ltd’s <AMP.AX> chances of coming back into the game. AMP, Australia’s No.2 funds manager, had launched the initial bid for AXA APH, which was later trumped by NAB.

Both companies are fighting to increase their dominance in Australia’s $1 trillion wealth management industry.

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