Prudential looks to expand brand in Asia through AIA acquisition

Prudential, the British insurance firm, has confirmed it is in advanced talks to buy AIA, the Asian arm of American International Group, in a deal that would transform it into one of Asia’s biggest insurers.

The proposed deal “represents a unique and strategically compelling opportunity for Prudential,” the group said in a statement. It gave no financial details.

Prudential is expected to pay $25bn (£16bn) in cash and the balance in equity, which may be in preference shares, options or warrants. A further £15bn will be raised through a rights issue, the biggest-ever attempted by a UK company, with backing from investment banks HSBC, Credit Suisse, and JP Morgan, to support the deal.

The UK insurer already has 11 million customers in Asia. In 2008, and the comapny says the region accounted for 57% of its new business profits.

AIG currently sponsors Premier League champions Manchester United and had to be saved from collapse by the American government in September 2008. The US Treasury decided the business was too important to the country’s economy to be allowed to fail.

The company was bailed out with around £120bn of US taxpayers’ cash after racking up huge losses on toxic derivative deals.

Latest from Marketing Week

NOT REGISTERED? IT'S FREE, QUICK AND EASY!

Access Marketing Week’s wealth of insight, analysis and opinion that will help you do your job better.

Register and receive the best content from the only UK title 100% dedicated to serving marketers' needs.

We’ll ask you just a few questions about what you do and where you work. The more we know about our visitors, the better and more relevant content we can provide for them. And, yes, knowing our audience better helps us find commercial partners too. Don't worry, we won't share your information with other parties, unless you give us permission to do so.

Register now

THE BEST CONTENT

Our award winning editorial team (PPA Digital Brand of the Year) ask the big questions about the biggest issues on everything from strategy through to execution to help you navigate the fast moving modern marketing landscape.

THE BIGGEST ISSUES

From the opportunities and challenges of emerging technology to the need for greater effectiveness, from the challenge of measurement to building a marketing team fit for the future, we are your guide.

PERSONAL AND PROFESSIONAL DEVELOPMENT

Information, inspiration and advice from the marketing world and beyond that will help you develop as a marketer and as a leader.

Having problems?

Contact us on +44 (0)20 7292 3711 or email subscriptions@marketingweek.com

If you are looking for our Jobs site, please click here