Page 1 of 7

Prudential PUK; 2378 HK

PostPosted: Tue Apr 27, 2010 5:04 pm
by winston
DJ Prudential's Largest Shareholder Said To Have Launched Break-Up Bid - UK Times
DOW JONES NEWSWIRES

U.K. insurer Prudential PLC's (PRU.LN) biggest shareholder is possibly moving toward breaking up the insurer that could derail its purchase of AIG's (AIG) Asian unit, the U.K newspaper the Times reported, citing unnamed sources.

Capital Group, which owns 12% of Prudential, is said to have approached at least three U.K.-based insurers for a consortium bid, the paper said on its Web site. Resolution, Clive Cowdery's acquisitions vehicle, and Prudential rival Aviva have been approached, the report said.

Prudential has launched an effort to buy American International Group Inc.'s Asian unit for $35.5 billion. It will release terms of a rights issue on May 5 and has applied for a secondary listing in Singapore.

Re: Singapore Exchange 2 (Feb 10 - Jun 10)

PostPosted: Tue Apr 27, 2010 6:30 pm
by kennynah
i heard they are duo listing in HKSE and SGX ? no?

Re: Singapore Exchange 2 (Feb 10 - Jun 10)

PostPosted: Tue Apr 27, 2010 6:34 pm
by winston
kennynah wrote:i heard they are duo listing in HKSE and SGX ? no?


Yes, primary listing is in HK and the secondary listing is in Spore.

But the Capital Group together with Resolution and Aviva, is trying to stop the deal. Please see the "Insurance" thread in the Business Sector section.

Re: Singapore Exchange 2 (Feb 10 - Jun 10)

PostPosted: Tue Apr 27, 2010 8:33 pm
by LenaHuat
Hi Winston and K :D
Yes, it's raising capital via rights issue. What I mean is that it's not a IPO-type of listing.

Re: Singapore Exchange 2 (Feb 10 - Jun 10)

PostPosted: Tue Apr 27, 2010 9:11 pm
by kennynah
oh ic...they are issuing "rights" and not listing in HK and SGP...

Re: Insurance & Reinsurance

PostPosted: Wed Apr 28, 2010 8:30 am
by winston
Prudential bid to buy AIA may falter

Wednesday, April 28, 2010

Prudential may fail to purchase American International Assurance for US$35.5 billion (HK$276.9 billion) amid disagreement among shareholders and risks of a breakup of the UK- based insurer into three regional units.

Prudential's biggest shareholder, Capital Group, is seeking partnership with three British insurers to acquire Prudential before the merger with AIA, The Times reported yesterday.

Capital, an US investment fund that has a 12 percent stake of Prudential, has reportedly approached Resolution, Aviva and another party for "a possible" consortium bid.

"To hear that Capital is not supportive of the deal will stir this up a lot more," a top shareholder told Reuters.

"There is merit in the argument that more value might be realised if [Prudential] were broken up. We have encouraged [Prudential] to sell the UK business and focus on the Asian business."

A breakup could be worth about 955 UK pence (HK$11.36) a share, Panmure Gordon analyst Barrie Cornes said in London.

Prudential shares hovered between 547 pence and 563 pence yesterday.

Cornes believes Resolution is keen to buy Prudential's UK unit to build a 10 billion (HK$119 billion) British insurer while Aviva, the second largest UK insurer, may seek to acquire its US unit, Jackson National Life.

About 75 percent of Prudential shareholders must vote for acquiring AIA on May 27 for the deal to proceed. "There is a very good chance they won't get it," a top shareholder said.

Prudential is expected to start trading in Hong Kong on May 11.

MANDY LO AND AGENCIES

http://www.thestandard.com.hk/news_deta ... 00428&fc=4

Prudential 2378

PostPosted: Fri May 28, 2010 3:34 pm
by winston
Not vested. It's dropping in London now ..

DJ MARKET TALK: Prudential +6.6%; Confirms In Talks On AIA Deal

1509 [Dow Jones] Prudential (2378.HK) +6.6% at HK$62.90, after trade resumption in HK with company confirming it's in talks with AIG on transaction details of acquiring AIA; no other details provided. This after Wall Street Journal report citing people familiar with matter saying Prudential in talks with AIG to cut price of its $35.5 billion acquisition of AIA, while still unclear how big a price cut could stomach.

"I think the gains in its shares are just catching up with other European, North American counterparts, as further details regarding its AIA deal are needed to give a clear judgement on its shares," says Linus Yip at First Shanghai.

Other overseas-based insurer Manulife (0945.HK) also higher, +5.0% at HK$131.40. Suggests avoid stock given number of overhangs, including response to its rights issue and confirmed details of AIA deal.

Source: Dow Jones Newswire

Re: Prudential 2378

PostPosted: Fri May 28, 2010 4:12 pm
by helios
W,

It was said that with or without the transaction deal, PRU price would still go up ... ...

True?

Re: Prudential 2378

PostPosted: Fri May 28, 2010 4:23 pm
by winston
Ha Ha San ... you are saying that it will go up no matter what :P

If I'm putting betting money, I will buy only if the transaction does not go thru. This is because a lot of people in the insurance industry believes that Prudential is overpaying.

Prudential of course would disagree :P

Re: Prudential 2378

PostPosted: Fri May 28, 2010 5:11 pm
by millionairemind

US tells AIG to lower price of deal with Pru
Talks have reopened between AIG and Prudential to reduce the price tag of AIA to as little as $30bn after the US government demanded the insurer made attempts to salvage the deal.

By Louise Armitstead
Published: 8:04AM BST 28 May 2010

The radical intervention, which is said to have come in the form of a "strong suggestion" from the office of Tim Geither, the US Treasury Secretary, was made in the face of a mounting investor rebellion just 10 days ahead of the crucial vote.

AIG and its advisers are working on ways in which they can reduce the headline price tag to as little as $30bn, rather than restructure the debt and equity components of the deal, according to insiders.

The sources said that the company's advisers had warned them that their fall-back plan, which was to float AIA in Hong Kong, was "no longer an option" given the deteriorating market conditions.

One insider said: "AIG knows it has a willing buyer in the Pru and there aren't signs of any others, so it either goes back to the drawing board or does the deal at a lower price. The US government has made it clear which option it prefers."

The American government, which owns 80pc of AIG, is determined to get the failed insurance giant off its books. Through AIG, the US state has already agreed to take on $5.5bn, or 10.9pc, of the new company and has offered to sweeten the mix of its stake if it will help persuade investors to accept the deal.

In statement on Friday, Prudential confirmed that talks had taken place between the Pru and AIG which "may or may not lead to a change in the terms" of the takeover.

Prudential's shares, which soared by nearly 7pc to 547.5p yesterday as rumours swept the market that the deal had collapsed, opened up 1.4pc today. Prudential needs 75pc shareholder support at the crucial vote on June 7th.

They have balked at the deal that involves a record £14.5bn right issue and will nearly double the size of the British insurer.

Two of Prudential's biggest American investors, Janus and Wellington, both rejected chief executive Tidjane Thiam's arguments for the deal, The Daily Telegraph has learned. The investors, who both met Mr Thiam in recent days, are said to be "unconvinced" by the deal on the grounds of price.

A source close to one of the investors said: "Thiam's arguments for the long-term growth of Asia are one thing but it's expensive, particularly right now when it doesn't feel like a good time to be taking risks."

Mr Thiam is in the middle of leading an international investor roadshow. He is currently in Boston on the American leg and is due to return to London for a few days next week before heading off to Asia just ahead of the vote.

In Britain, Legal & General, Blackrock and Capital, which owns Prudential through various funds, are among those that have expressed deep reservations about the deal.

Robin Geffen, chief investment officer of fund manager Neptune, claimed that institutional investors with more than 15pc of Prudential stock and private investors with holdings of more than 4.87pc would vote against the takeover.

Mr Geffen said: "Support is accelerating daily and the required 25pc plus one vote is not far off."

A rebellion by shareholders on this scale is highly unusual in the City, where deals are very rarely halted at such an advanced stage. However, investors are particularly wary of transformational deals after being stung by the disastrous takeover of ABN Amro by Royal Bank of Scotland in 2007.

The influential shareholder advisory group RiskMetrics, which works with pension funds around the world, is urging shareholders to vote against the deal.