Sharechat Logo

AMP to raise as much as A$500m in share sale to boost capital

Wednesday 5th November 2008

Text too small?
AMP, Australia's biggest provider of pension plans, will raise as much as A$500 million selling shares to institutions and individual investors to bolster capital amid the credit market freeze.

The insurer will raise A$400 million in a fully underwritten placement to institutional investors. At the same time, it will offer individual shareholders in Australia and New Zealand the opportunity to subscribe for A$5,000, raising a maximum of A$100 million.

"AMP is making the placement to enhance its capital position and increase business flexibility through the ongoing market turbulence," the Sydney-based company said in a statement.

AMP also released a business update for the third quarter, which chief executive Craig Dunn said shows the insurer "continued to perform solidly." The figures show assets under management in its Contemporary Wealth Management business fell to A$51.3 billion in the three months ended September 30 from A$53.6 billion at June 30. Assets under management for its AMP Capital Investors unit fell to A$101.5 billion from A$105.2 billion.

In August, AMP posted a 22% decline in first-half profit, reflecting slumping markets and falling demand for managed funds. Profit dropped to A$366 million from A$470 million. At the time, Dunn said earnings may revive in 2009 as markets recover.

The capital raising announced today will increase AMP's flexibility at a time of turmoil in credit markets, the company said.

"Our bias is to have more capital rather than less in these difficult market conditions," Chief Financial Officer Paul Leeming said.

Shares of AMP have gained 8.9% on the ASX in the past week, trimming their 12 month slide to 42%.

By Jonathan Underhill



  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

28th October 2021 Morning Report
Wellington Drive Technologies Limited (NZX: WDT) Performs Strongly in Q3-2021
Ryman Healthcare Limited (NZX: RYM) Acquires Extensions to Two Existing Victorian Sites
Promisia Healthcare Limited (NZX: PHL) Banking Covenant Update
Pictor Limited Announces Start of US Clinical Trials for SARS-CoV-2 Serology Test
Arvida Group Limited (NZX: ARV) Opening of Rights Offer
Move Logistics Group Limited (NZX: MOV) Announces $40m Capital Raise
27th October 2021 Morning Report
The a2 Milk Company Limited (NZX: ATM) Investor Day 2021
Contact Energy Limited (NZX: CEN) Considers Green Capital Bond Offer