Prudential PUK; 2378 HK

Re: Prudential PUK

Postby winston » Wed Dec 04, 2019 7:17 am

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Should Value Investors Consider Prudential (PUK) Stock Now?

Source: Zacks Equity Research

https://finance.yahoo.com/news/value-in ... 02704.html
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Re: Prudential PUK

Postby winston » Tue Feb 25, 2020 1:59 pm

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Hedge fund Third Point calls on Britain's Prudential to break up

By Svea Herbst-Bayliss

(Reuters) - Hedge fund Third Point LLC amassed a more than $2 billion stake in Prudential Plc <PRU.L> and called on the British insurer on Monday to split into two companies.

Third Point's demands, first reported by Reuters earlier on Monday, could lead to a major shake-up at Prudential, only a few months after it spun out its European insurance and asset management businesses into a new company called M&G Plc <MNG.L>.

Third Point, which specializes in shareholder activism and is run by Daniel Loeb, wrote to the 332-year old London-based company on Monday to ask it to separate its Asian and U.S. businesses.

The New York-based hedge fund said Prudential's stock would benefit if it stopped running its crown jewel Asia business and its U.S. business, Jackson National Life, out of one holding company in Britain.

Jackson accounts for a small portion of Prudential's value, but is extremely complex to analyze, Third Point said. As a result, investors are undervaluing Prudential's Asia business because they are bundling it with Jackson, Third Point added.

Moreover, the current structure is putting Prudential at a disadvantage when it comes to recruiting top talent in Asia, according to Third Point.

In the letter, addressed to Prudential's board of directors, Third Point also blamed the company's management for prioritizing dividend payouts over reinvesting in the business.

Third Point is arguing that some of the benefits of a split would include cost cuts at Prudential's British holding company, better capital allocation policies, and better management of the U.S. and Asia businesses, the sources said.

"If PruAsia and Jackson were separated, resulting in a greater focus on reinvesting capital in each unit and streamlining central costs at the group level, our analysis indicates that the interests represented by Prudential plc shares can double within three years," Loeb wrote in the letter.

Prudential confirmed in a separate statement that it had received a letter from Third Point and looked forward to commencing a dialogue with the hedge fund.

While Prudential's headquarters are in London, it is regulated in Hong Kong following its separation from M&G.

A source told Reuters earlier this month that Prudential was studying options to reduce its ownership in Jackson, including seeking "outside capital."

Third Point's stake is equivalent to just under 5% ownership of Prudential, making the fund the company's second-largest shareholder and Prudential the hedge fund's biggest position currently, according to the sources. Prudential has a market capitalization of 36.8 billion pounds ($47.5 billion).

Third Point, which has $14 billion in assets under management, has experience in pushing companies to split themselves apart, including at Yum Brands, Dow Chemical and most recently United Technologies.

To raise additional capital to build the stake in Prudential, Third Point raised a so-called special purpose vehicle, which allows hedge funds to raise money quickly and investors to put money to work in the stock of a specific company instead of a co-mingled fund.

Although Third Point is based in the United States, a significant portion of its recent activist engagements have taken place overseas, at companies including Sony Corp <6758.T>, Nestle <NESN.S> and EssilorLuxottica <ESLX.PA>.

Source: Reuters

https://finance.yahoo.com/news/exclusiv ... 11312.html
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Re: Prudential PUK

Postby winston » Thu Mar 12, 2020 6:24 am

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Prudential (2378) said its adjusted operating profit rose 20 percent to US$5.31 billion (HK$41.42 billion) last year and it will spin off its US annuity business, a top-two annuity provider Jackson.

A second interim dividend of $25.97 US cents was declared.

The profit of the life insurance business was down by 6 percent to US$4.41 billion.

Meanwhile, a double-digit growth was recorded in new business profit in eight markets in Asia.

However, Prudential Hong Kong business fell 11 percent, dragged down by a fall in mainland visitors resulting from social unrest in the second half.

Chief executive Mike Wells said the domestic market growth is still strong in Hong Kong with 8 percent growth in insurance premiums for Hong Kong customers.

He said he was confident on Hong Kong prospects while the Hong Kong strategy remained unchanged.

The group announced that it is preparing for a minority initial public offering of Jackson to be listed separately on the US stock market.

Manulife chief executive Damien Green said the group's business performed well in the beginning of the year.

He believed the related-business has room to grow as the demand for retirement in Hong Kong is huge and strong growth for the qualifying deferred annuity policy has been recorded for the past two years.

Source: The Standard
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Re: Prudential PUK; 2378 HK

Postby winston » Fri Jun 19, 2020 6:30 am

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Prudential sells Jackson equity stake to Apollo-backed Athene for US$500 mil

by Sinead Cruise

LONDON (June 18): Prudential sold a minority stake in its U.S. business, Jackson, to Apollo Global-backed Athene Holding for US$500 million, the insurer said on Thursday, in the first phase of its plan to create an independent U.S. business.

The London-listed, Asia-focused insurer, which is also regulated in Hong Kong, has been looking for ways to bring external capital into the U.S. annuity provider and said it would continue to evaluate options for the part of the business it still owned, including a minority initial public offering.

The end goal was to create an independent U.S. business, Prudential said, without giving details on how much of Jackson it still wanted to keep.

"This agreement is a key step forward in meeting our strategic objectives for Jackson," Chief Executive Mike Wells said in a statement.

Athene's investment, which hands the retirement services company an 11.1% economic interest in Jackson's enlarged common equity, was expected to close in July, Prudential said.

Some analysts say there is little logic in Prudential holding onto Jackson, which has few synergies with its Asian arm — where profits and new business sales have historically been higher.

Prudential shares were trading 7% up at 1025 GMT on news of the stake sale, which could help the 170-year old company narrow a hefty conglomerate discount on its stock.

"The deal is particularly welcome since there were concerns the current market conditions would make a disposal difficult," said Nicholas Hyett, Equity Analyst at Hargreaves Lansdown.

"The inherently unpredictable nature of Jackson's large variable annuity portfolio isn’t exactly the reliable income model investors generally expect from a life insurer."

Prudential shares have fallen 13% this year so far but it remains one of the few UK-listed insurers to pay a dividend after the Bank of England called a halt to shareholder payouts after the outbreak of coronavirus.

In addition, Prudential said Athene — which counts Leon Black's Apollo Global Management as its biggest shareholder — would fully reinsure US$27.6 billion of Jackson's in-force fixed and fixed indexed annuity portfolio from June 1.

The combined effects of investment and reinsurance transactions are expected to raise Jackson's risk-based capital cover ratio by 80 percentage points, Prudential said.

Source: Reuters

https://www.theedgemarkets.com/article/ ... -us500-mil
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