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UPDATE 1-Australia's AXA-Apac ups bid ante with strong profit

Published 01/20/2010, 07:13 PM
Updated 01/20/2010, 07:18 PM

* Profit view may push competing bidders to raise price

* Strong second-half helps profit upgrade (Adds details, analyst comments)

SYDNEY, Jan 21 (Reuters) - Life insurer and fund manager AXA Asia-Pacific Holdings Ltd telegraphed higher than expected profits on Thursday, putting pressure on rival bidders to raise their offers in a $12 billion battle for the company.

AXA Asia-Pacific, being circled by National Australia Bank and a rival consortium of AMP and French parent AXA SA , issued a trading update, saying it expected to report full-year 2009 earnings ahead of market consensus.

"The forecast is generally positive and that would sharpen the need for both the acquirers to consider upping their bid," said Michael Heffernan, a strategist at Austock Group.

AXA Asia-Pacific said its calendar 2009 profit after tax and non-recurring items would come in at about A$675 million, which analysts say would be almost A$100 million above consensus and could alter the takeover math. It posted a loss of A$278.7 million a year ago.

At 2352 GMT AXA Asia-Pacific share were up 0.3 percent at A$6.62 in a market that was down almost 1 percent.

The company joins Commonwealth Bank of Australia , Flight Centre and Computer Share in upgrading profit forecasts as the local economy bounces back.

"We have responded well to the impacts of the global financial crisis and the earnings of all of our businesses have accelerated since the first half of 2009," AXA Asia-Pacific Chief Executive Andrew Penn said in the trading update.

The Australian economy, which turned down but evaded recession last year, has outperformed its global peers mainly on strong China demand for its resources and good domestic consumption.

AXA Asia Pacific said performance of all regional operations such as Hong Kong, Southeast Asia, Australia and New Zealand improved. ($1=1.098 Australian Dollar) (Reporting by Narayanan Somasundaram; Editing by Mark Bendeich)

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