AMP receives takeover bid from US firm Ares
Wealth giant AMP has announced it has received a takeover proposal from an American firm to acquire 100 per cent of its shares, almost two months after it put parts of the company up for sale.
AMP told the market on Friday morning it had received an indicative, non-binding, conditional proposal from Ares Management Corporation to buy the company, but said no decision had been made. It didn't provide any details on the pricing of the proposal.
AMP has received a takeover bid from a US private equity firm.Credit:Getty
"AMP notes discussions on the proposal are at a very preliminary stage and there is no certainty that a transaction will eventuate," it said.
AMP appointed a team of consultants and lawyers on September 2 to examine opportunities presented by third parties keen to buy AMP's assets. AMP, which has been beset by reputational damage this year, said it had received "significant interest" in its assets and businesses and would assess its options in a "considered and holistic manner".
Sources familiar with the negotiations have said chief executive Francesco De Ferrari does not want to splinter the group and instead would prefer to stick to the company's three-year transformation strategy. Mr De Ferrari has previously said he considered the business undervalued.
The statement said AMP would also consider "continuing to pursue its three-year strategy, with a focus on maximising shareholder value".
Allan Gray managing director Simon Mawhinney said it was "no surprise at all" that parties were interested in buying AMP.
"AMP looks astonishingly cheap to us," he said. "Today is a once in a generation opportunity to buy a reasonable asset at a very depressed price."
"The company has had issues, that’s clear. But everything has a price. So it’s important not to divorce the two.
"Yes, AMP has or had or continues to have cultural issues that have impacted the business, but that doesn’t mean it's worth nought. There appears to be the will to fix these issues today, for the first time in a long time."
AMP is facing a number of class actions, brought on by its own financial advisers and customers, over allegedly defective financial products and improper conduct.
The company has experienced a high turnover of staff following the botched handling of a sexual harassment complaint which ended in the resignation of chairman David Murray.
An Ares spokesman declined to comment.
Charlotte is a reporter for The Age.