Australia’s AMP has scrapped plans to divest its New Zealand wealth management arm after offers for the unit fell short of its expectations, citing disruption caused by the coronavirus pandemic on the economy and financial markets.
The country’s biggest wealth manager announced on Friday, May 8, it held talks with a number of parties on selling the business, once valued at between NZ$300 million (US$182.58 million) and NZ$500 million (US$306.9 million), reported Reuters. But it stated with offers failing to match its target, it would instead focus on expanding the unit in existing markets.
But it comes as a series of Australian mergers and acquisition deals face lower prices, with advisers and bidders having difficulty achieving their desired price tags for assets during the coronavirus crisis.
In March, sources had told Reuters that bidders for Australia and New Zealand Banking Group’s car lender UDC Finance were lowering their offers. A private equity battle for control of media and entertainment firm Village Roadshow was also expected to see lower pricing.
Last month, Canada’s Alimentation Couche-Tard walked away from a proposed buyout of petrol station operator Caltex Australia, citing the impact of the virus outbreak.
AMP stated it would furnish more details of its business plans along with its half-year results in August. It reported a AU$19.4 billion (US$12.7 billion) decline in first-quarter assets under management across the unit in April, amid a plunge in equity and commodity valuations triggered by the coronavirus outbreak.
Full Content: Reuters
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