All six independent Axa Asia Pacific Holdings (Axa APH) directors have now approved the AMP take-over bid clearing the way for a formal offer to be put to shareholders.

The bid by AMP will still need an independent expert’s report for Axa APH shareholders and regulatory approval although the bid has cleared the competition bodies in both Australia and NZ.

It is expected an offer document will be sent to Axa APH shareholders early next year after AMP has conducted its due diligence of Axa APH’s books.

A final merger of the two companies is expected to occur in the last quarter of this financial year with Axa APH’s Asian business being sold to the French parent at that point.

Axa APH shareholders will now receive $6.43 per share, consisting of cash and AMP shares, as well as the 2010 final dividend of up to 9.25 cents per share. 

According to research house Plan For Life’s June 2010 figures, the combined Australian operations will have about 35% of life insurance premium, easily eclipsing its nearest competitor NAB/MLC with 21% market share.

In life insurance risk premium inflows, the combined companies will have a market share of 16.7%, slightly ahead of the market leader NAB/MLC with 15.7%.

The dominant market position of the merged companies in the financial services industry has also concerned the Finance Sector Union regarding potential job losses.

Axa APH is based in Melbourne while the bulk of AMP’s operations are Sydney-based.

“Large scale mergers such as the one proposed between Axa APH and AMP provide little benefit to finance sector workers or consumers,” Acting FSU National Secretary Wendy Streets said.

“For the 2000 Australians who work at Axa APH, there is genuine concern that a merger or takeover may put their jobs at risk.”

AMP CEO Craig Dunn argues the merged company will have the market position to be a stronger competitor in financial services.

“The merged company will have the scale and expertise to provide Australian and NZ consumers with an improved range of low cost, simple options,” he said.