Prudential’s failed takeover bid won’t push up premiums

Home Who are LookforLife? Glossary Contact us FAQs

Personal

Cover needed for:

Date of birth:

Do you smoke:

To find the lowest rates from the UK's top providers please complete the 30 second form below. You will then receive your FREE, no obligation quote:
Title:	First Name:	Last Name:
E-Mail:	Main Phone:	Work/Mobile Phone:
Address First Line:	Postcode:	Gender:
How much cover?:	How long for?:	Type of cover?:
Premium type:	With critical illness?:

Partners title:		First Name:		Last Name:
Does your partner smoke?		Date of birth

By clicking "Get Quote" opposite you agree to be contacted email or phone by an FSA Authorised Advisor and confirm that you have read and agreed to our Ts & Cs and Privacy Policy.

If you do not want to receive news and other special product offers from us please untick this box

Prudential’s failed takeover bid won’t push up premiums

Friday, August 13, 2010

Prudential, the British insurance giant, has revealed the shocking cost of the company’s failed bid for the Asian branch of American organisation AIG (American International Group). Before tax, the loss to the Prudential amounts to around 377 million pounds.

In June this year, Prudential pulled out of discussions with AIA to pay $35.4 billion for the takeover. AIA had refused a lowered offer of just over $30 billion, which proved to be unacceptable. as a result of this, Prudential desisted from further negotiations and decided against the procurement. The Prudential was placed under pressure from its shareholders, who made it clear that they would not be in favour of the takeover unless the firm significantly reduced the price tag by up to $5 billion.

Had the deal gone ahead, the Prudential would have secured a strong position as the leading insurer within South East Asia. However, the failure of the bid means that the company now faces costs of £450 million since withdrawal from negotiations, including a break-up fee of £152.6 million.

Despite this, the company has just announced a first-half operating profit of £1.68 billion, giving potential new and existing customers peace of mind that their premiums will not be pushed up in order to compensate for the loss of finances resulting from the failed Asian takeover deal.

In Asia, the Prudential is the leading European life insurer with life and fund management operations in 13 countries serving some seven million customers. Within the US, they own Jackson National Life, a leading life insurance company, and have almost three million policies and contracts in force. Established in 1848, today Prudential plc is an international financial services company with a product range including personal banking, insurance, pensions and retail investments, institutional fund management and property investments. In the UK they are a leading life and pensions provider, with around seven million customers.

Category: Life Insurance