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NAB to challenge ACCC knockback on AXA bid

Wednesday 21st April 2010

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National Australia Bank is signalling it will take Australia's competition watchdog to court rather than try to restructure its rival offer for the Australian and New Zealand assets of AXA Pacific Holdings, which the regulator declined late Monday.  

After a day to consider its options, and amid media speculation that it might pursue divestments to make the acqusition more palatable, NAB's statement to the ASX and NZX today says it "does not agree" with the Australian Competition & Consumer Commission and that its fight to wrest the opportunity from AMP remains alive.

"NAB believes that the ACCC’s characterisation of the relevant market is incorrect," the statement said. "It does not agree that there is any substantial lessening of competition, including in the segment of the market that provides retail investment platforms for investors with complex investment needs. This is a segment NAB and MLC understand very well and do not believe present any competition concerns.

"There is a range of options open to NAB and these are being actively pursued", said NAB, which was "disappointed" by the decision, given consultations with the ACCC. 

The regulator's decision appears to clear the way for an uncontested bid from AMP for the Australasian assets of AXA, but market reports suggest the insurance and investment group is unlikely to show its hand until there's clarity about NAB's position. While NAB has six weeks to respond in full to the ACCC decision, a process of judicial review could delay any sale for considerably longer. 

AMP shares traded on the NZX this morning down 0.6% at $8.10, which NAB was steady in ASX trading at A$28.80, having risen slightly after the ACCC announcement appeared to remove the prospect of a substantial capital-raising exercise.

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