Prudential hits choppy waters regarding Asian expansion
The multibillion-dollar acquisition of American International group's Asian arm by the Prudential Group is under threat today with serious reservations displayed by major shareholders. It is believed that Capital Research and Management, the largest individual shareholder in Prudential, is concerned about the $21 billion fund-raising to accompany the acquisition and would appear to be in favour of a potential breakup of the UK group.
Since the proposed Asian acquisition was announced some time ago there has been concern within the investment markets regarding the size of acquisition and the ability of the Prudential management to make it work. Some analysts believe the company is unlikely to get the 75% shareholder backing required and may need to go back around the negotiating table to see what other options lay ahead.
Since Prudential announced the proposed acquisition of the AIA operation there has been constant speculation regarding the future of Prudential itself. This is a company which has apparently been on the buying list of many worldwide insurers over the years but not one of the rumoured bidders has shown their hand as yet. The next few weeks are vital for the management of Prudential and the proposed AIA acquisition.
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