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Axa tipped for merger with Alliance

By Ray Lilley

Friday 20th October 2000

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Axa Pacific Holdings is poised to announce Alliance Capital Management is to take over Axa Pacific's funds management arm in New Zealand and Australia.

Brokers say poor investment performance and the inability of Axa's Asia-Pacific arm to attract replacements for key staff has triggered the merger.

Alliance Capital Management is a partly owned subsidiary of US-based Axa Financial, in turn owned by French-based Axa SA.

"This merger shows the company has decided effectively to outsource its funds management function to Alliance. It's the only option as they can't hire the right staff," a Sydney broker said.

"Alliance will have the upper hand in the merged entity and is better respected by the research houses."

The Axa depleted groups had struggled to win research teams' confidence. Both groups have asset management teams in Australia and New Zealand, which will rationalise their activities.

Axa Pacific Holdings managing director Les Owen is expected to announce the merger Monday in a transtasman linkup.

Australian reports said Monday's media announcement of the combined investment management operation here would come from Michael Bargholz, Axa New Zealand's present head of investment management operations.

Alliance head of equities in Australia Don Low is tipped to lead the merged operation there.

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