Well enough

28 January 2021 By Aimee Donnellan Follow @aimeedonnellan

The $46 bln insurer is demerging its American unit and raising up to $3 bln in equity as it focuses on Asia. Investors expecting a capital bonus will now worry about its ability to fund future growth. But if the move helps Pru achieve an AIA-like multiple, it’s worth the trouble.

This content is for Subscribers only

Context News

British insurer Prudential said on Jan. 28 it would separate its U.S. business Jackson through a demerger to better focus on Asian and African markets.

The British life insurer also said it was considering raising $2.5 billion to $3 billion in new equity in Hong Kong or London to reduce leverage by redeeming high-coupon debt.

Prudential said the demerger would allow a quicker separation of Jackson than an initial public offering and gradual sale of its stake.

The company said shares in Jackson would be distributed to Prudential shareholders after the demerger, which is expected in the second quarter of 2021.

Prudential said it would retain a 19.9% stake in Jackson.

Prudential shares were down 6.9% at 12.47 pounds by 0853 GMT on Jan. 28.

Email a friend

Please complete the form below.

Required fields *