It’s only media speculation, but Brisbane-based Suncorp is at the centre of acquisition rumours again. The Australian Financial Review says Suncorp has not renewed its contract with a long-time corporate adviser, giving vent to media speculation that the company is on the verge of merger and acquisition (M&A) activity.

Some analysts see Suncorp as the most likely source of consolidation activity in the financial services sector. The article claimed Suncorp was rebuffed by St George Bank and Promina when it approached them about a friendly merger.

The report says this has led to speculation that a tie-up with a larger financial institution led by Westpac Banking Group or ANZ Banking Group could be on the agenda.

JP Morgan analyst Shane Fitzgerald told Sunrise Exchange News he doesn’t see much basis to the speculation. “There have been more rumours in the past five years concerning Suncorp merger and acquisition activity than any other company in this market.”

He also doubts that a bank would be interested in a merger with Suncorp. “It’s unlikely a bank would want to take over a company with insurance products and an underwriting capability.”

He sees more merit in a merger with Promina, but doubts whether the Australian Competition and Consumer Commission would approve it.