It may seem fanciful that Tidjane Thiam and other directors at Prudential believed that a leak of their planned $35bn takeover of AIA three years ago might come from the FSA. But they did. Here’s paragraph 4.6 from the final notice censuring Mr Thiam and fining the Pru $30m…
4.6. The directors of Prudential, including Mr Thiam, met on 31 January 2010 to be briefed on the proposed transaction by Credit Suisse. There was a consensus between the directors of Prudential at this meeting that:
(1) a leak was the key risk to the transaction;
(2) the FSA was one of a number of parties which might be the cause of a leak; and
A theory was gaining ground on Wednesday that, having utterly failed in any way to deal with Britain’s cartwheeling banks ahead of the crisis, the FSA, Britain’s alleged financial regulator, has now set its sights on wrecking the healthy side of Britain’s financial sector.
The Prudential has been fined £30m, and its strikingly successful chief executive, Tidjane Thiam, has been censured, seemingly for worrying that someone at the FSA might possibly leak news of the Pru’s ultimately bungled takeover bid for AIA three years ago. Read more
Bold, strategic, reckless?
There are a number of ways to view G4S’s proposed acquisition of Danish rival ISS for £5.2bn. Read more
Calls for a shake-up of the Prudential’s board of directors could intensify this week as the life assurer meets some of its top shareholders in the wake of its failed bid for AIA, reports the FT. Fidelity International, the investment group, is to meet Harvey McGrath, the Pru chairman, on Monday ahead of a week of critical meetings between main board directors and shareholders. Investors have called for McGrath and Tidjane Thiam, the chief executive, to resign following the $35.5bn bid for AIA in Asia, which incurred costs of more than £400m.
Shareholder discontent over the Prudential’s aborted bid for AIA is increasingly focusing on Harvey McGrath, chairman, and a growing feeling he should quit the UK life assurer, reports the FT. Key shareholders who had been calling for the departure of Tidjane Thiam, chief executive, now say that the chairman should leave instead to make way for a stronger, independent candidate.
As the pressure mounts on Prudential CEO Tidjane Thiam, rivals and interested parties are piling in with their tuppence worth.
As Sky News commentator (and FT columnist-to-be) Mark Kleinman, wrote on his blog on Tuesday, at least three of the Pru’s biggest shareholders will hold showdown talks next week with the life assurer’s directors to demand boardroom changes. Read more
UK insurer Prudential is not considering a renewed attempt to buy AIG’s Asian life unit, the company said on Sunday, denying a media report that a fresh bid was in the works, reports Reuters. The Sunday Times reported that the Pru was considering resurrecting its bid and that CEO Tidjane Thiam believed he could table another offer before year-end. The Pru last week scrapped its plan to buy AIA, AIG’s Asian life unit, for $35.5bn after shareholder objections.
Mark Tucker, a former chief executive of Prudential, has emerged as a dark horse candidate to replace either the chairman or chief executive of the UK life assurer following its aborted $35.5bn bid for AIG’s Asian assets, reports the FT. Tucker is being quietly touted by at least two top-15 shareholders ahead of Monday’s annual general meeting in which Harvey McGrath, chairman, and Tidjane Thiam, chief executive, are likely to face further criticism over last week’s collapse of Pru’s costly bid for AIA.
Prudential is seeking support from shareholders as part of a fightback against calls for its top management to resign following the collapse of the UK life assurer’s putative $35.5bn takeover bid for the Asian business of AIG. Tidjane Thiam, chief executive, and Harvey McGrath, chairman, will face a public grilling over the abortive acquisition at the group’s annual shareholders’ meeting on Monday, the FT reports.
Cheer up, Prudential. Tomorrow’s another day, even if your ‘transformational’ bid for AIA has blown up and your chief executive is looking ready for the chop.
So let’s look at the case for moving swiftly on. Read more
From Prudential’s statement ending the AIA deal on Wednesday:
Prudential on Wednesday said it would scrap its agreement to buy AIG’s Asia business, AIA, after the board of the US insurer voted against the Pru’s proposal to cut the purchase price from $35.5bn to $30.375bn and suggested reviving plans for an Asian stock market listing for AIA, reports the FT. Some investors called for the resignation of Tidjane Thiam, the Pru’s CEO, for failing to save the deal. Bloomberg adds that the UK life assurer will also abandon its $21bn rights offer planned to fund the AIA deal.
Prudential’s $35.5bn bid to buy AIG’s Asian insurance arm was on the verge of collapse on Tuesday night, the FT reported. Some investors called for AIA’s chief executive Tidjane Thiam to resign after he failed to renegotiate the deal. AIG’s board voted 10-2 against a proposal to cut to $30.375bn the price paid for AIA, preferring to resurrect plans for a partial sale of AIA in an Asian stock market listing. Staffers at AIA’s Hong Kong HQ greeted the news with “unbridled euphoria“.
Prudential and AIG were scrambling on Sunday to agree a rescue price for the Pru’s $35.5bn takeover of AIA, the US insurer’s Asian businesses, after an investor revolt threatened to derail the deal, reports the FT. Tidjane Thiam, Pru’s CEO, met Robert Benmosche, AIG chief, and investors in the US at the weekend as the two sides attempted to reach a compromise. Earlier, the Sunday Times reported that key Pru investors agreed to back the deal if the UK life assurer could negotiate a 10% cut in AIA’s $35.5bn price tag, reports Reuters.
Prudential is trying to renegotiate the $35.5bn price tag on the Asian businesses of AIG in a last-ditch attempt to win the support of some of its biggest investors and head off a disastrous “no” vote on its planned takeover of AIA, the FT reported on Thursday.
Here’s more: Read more
Prudential shares have spiked on Thursday morning in London, FT Alphaville reports — amid speculation that its planned acquisition of AIA, AIG’s Asian unit, is set to be cancelled. Prudential has declined to comment, but key shareholders appear to be planning to vote against the deal. Read more
FT Alphaville has eight questions for Tijdane Thiam. A sample: ‘What valuations can reasonably be expected from the fire sales in India and China? You also state that the Pru will continue to seek value for shareholders. Does this mean Korea, Malaysia and Australia could also be on the block?’ Read more
The price action in Prudential shares on Thursday morning.
Tidjane Thiam, chief executive of Prudential of the UK, knocked back an offer to join Société Générale’s board after investors were astonished that he could consider such a role while trying to seal the UK life assurer’s ambitious $35.5bn takeover of AIA. Investors bombarded the Pru with calls of protest after SocGen announced on Wednesday that it would propose Mr Thiam for a non-executive directorship.
Tidjane Thiam, chief executive of Prudential of the UK, knocked back an offer to join Société Générale’s board after investors were astonished that he could consider such a role while trying to seal the UK life assurer’s ambitious $35.5bn takeover of AIA, the FT said. The reversal caused FT Alphaville to ask the question: do you trust Thiam’s judgement?
We certainly have some reservations about Tidjane Thiam, based on the following report from Reuters:
PRUDENTIAL PLC <PRU.L> – CHIEF EXECUTIVE TIDJANE THIAM WILL NOT BE TAKING UP THE OFFER TO JOIN THE BOARD OF SOCIÉTÉ GÉNÉRALE
If you thought Tidjane Thiam had enough on his plate trying to persuade shareholders to back the $35.5bn acquisition of AIG’s Asian business — well, think again.
The Prudential boss apparently has time to go plural. Read more
Given the unfortunate execution so far of the Pru’s bid for American International Assurance, the Asian business of AIG, FT Alphaville wonders whether the insurer’s attempts to sell its operations in the East are, well, cursed. Read more
Merrill Lynch is one of the few brokers able to comment on the $35.5bn Prudential/AIA deal and Blair Stewart and his team are taking full advantage.
They have published another interesting report on the deal this Monday morning. They have polled Pru investors and reckon approval of the deal should not been seen as a given because the prospects of gaining the 75 per cent approval needed under the deal terms – the acquisition has been structured as a scheme of arrangement – are finely balanced. Read more
… you’ve put Prudential into play!
Oh dear. This wasn’t in the script.
Prudential’s share price on Tuesday morning: Read more
UK insurance giant Prudential will look to Asia as a source of capital and could even seek to raise equity there after seeing strong demand for a $750m hybrid capital raising in the region this year. Tidjane Thiam, who takes over as CEO on Oct 1, told the FT that Asia would be a good source of capital as the company continues to expand. He rejected speculation that the Pru might sell its UK operations, saying that in the near term, the Pru’s UK business was a core part of the group. See interview transcript here.