Prudential to split off U.S. business Jackson, eyes $2.5-3 bln capital raise (updated)
28/01/2021 09:05
(Adds detail, shares, background CEO quote)
LONDON, Jan 28 (Reuters) - British life insurer Prudential
PRU.L said on Thursday it would separate its U.S. business
Jackson through a demerger to better focus on Asian and African
markets, while adding it was considering raising $2.5-3 billion
in new equity.
Prudential, under pressure from activist investor Third
Point, had originally planned a minority initial public offering
of the U.S. business. urn:newsml:reuters.com:*:nL8N2FD2BJ
It said in a statement that a demerger would allow a quicker
separation than a minority IPO and future sell-downs.
Prudential CEO Mike Wells said the demerger would
"significantly accelerate Prudential's transformation into a
business purely focused on profitable growth in Asia and
Africa".
Shares fell sharply after the announcement and were down
8.9% at 0904 GMT.
The company said shares in Jackson would be distributed to
Prudential shareholders after the demerger, which is expected in
the second quarter of 2021.
Following the demerger, Prudential said it would retain a
19.9% non-controlling interest in Jackson.
Prudential said operating results for 2020 were anticipated
to be in line with market expectations, ahead of its full-year
earnings announcement on March 3.
Shares in Prudential were down 5% at 0854 GMT.
(Reporting by Muvija M in Bengaluru and Carolyn Cohn in London
Editing by Rachel Armstrong)
((Muvija.M@thomsonreuters.com; within UK: +44 20 7542 1810,
outside UK: +91 80 61822698; Twitter: https://twitter.com/muvija_m;))