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Suncorp/Westpac in renewed merger speculation

Rumours have resurfaced about a possible $11 billion Westpac bid for Suncorp.

Former Westpac CEO David Morgan originally approached Suncorp in late 2006 with a merger proposition. Now his successor Gail Kelly has been linked in the national press with a revived bid for the Queensland-based bancassurer.

Suncorp’s $7.9 billion acquisition of Promina in the intervening period has added a layer of complexity to any transaction, with media reports naming QBE and Allianz as potential bid partners.

But the Australian Competition and Consumer Commission could have the final say, with competition issues a possible concern.

Suncorp’s share price firmed as speculation hit the markets last Tuesday, ending the day’s trading up 5% at $12.50 after reaching a high of $12.59.

The stock fluctuations prompted the Australian Stock Exchange to ask Suncorp for an explanation.

The financial services group issued a response claiming it was “not aware of any information that has not been announced which could explain the movement in the price of Suncorp securities”.