AMP to by­pass life sale vote

The Weekend Australian - - BUSINESS - AN­DREW WHITE

Mar­kets op­er­a­tor ASX will not re­quire AMP to seek share­holder ap­proval for the $3.3 bil­lion sale of its life in­sur­ance and ma­ture prod­ucts busi­ness, in a set­back for those share­hold­ers op­posed to the deal.

AMP said last night that the ASX had con­firmed the trans­ac­tion did not rep­re­sent the dis­posal of its main un­der­tak­ing and that there was no re­quire­ment to put it to a share­holder vote.

Share­hold­ers in­clud­ing bou­tique in­vest­ment house Mer­lon Cap­i­tal and con­trar­ian in­vestor Al­lan Gray said last week that the price was as much as $2bn be­low fair value and called for it to be put to share­hold­ers be­cause of its size and sig­nif­i­cance to AMP.

The Aus­tralian Coun­cil of Superannuation In­vestors also said it wanted share­hold­ers to have a say but did not have a view on the price of the deal.

Un­der ASX rules, the mar­kets op­er­a­tor can re­quire a com­pany to seek share­holder ap­proval if the as­sets be­ing dealt with ac­count for 50 per cent or more of any of four mea­sures: as­sets, rev­enue, earn­ings and af­ter­tax prof­its.

But AMP said last night that in­for­ma­tion pro­vided to the ASX from its De­cem­ber fi­nan­cial year ac­counts showed that the deal did not meet any of the ASX “rule of thumb” mea­sures.

The busi­ness ac­counted for 34 per cent of rev­enue, 32 per cent of earn­ings, 31 per cent of af­ter-tax profit and 25 per cent of as­sets.

AMP shares fell 24 per cent on the day the deal was an­nounced, on their way to a record low of $2.31.

They rose 6c to close at $2.67 yes­ter­day ahead of the AMP state­ment.

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