The insurer AIG has dusted off plans to list its Asian business should Prudential's attempted $35.5bn bid to buy the unit fail.
The American insurer is said to have asked Morgan Stanley and Deutsche Bank, lead underwriters on the planned flotation before it was shelved in favour of the Prudential offer earlier this year, to "refresh its analysis".
A source close to the situation said that the banks had reassured AIG, which is around 80 per cent owned by the US government, that they could "still get a flotation away at an attractive price".
"Given Pru's problems, AIG clearly has to have a contingency plan in place," said the source. "There is no premium bid to Pru's out there. Despite the volatile markets the banks remain bullish that a listing would be successful. And unlike the Pru deal, there is no execution risk. Investors know exactly what they are getting."
AIG has been forced to revisit the listing of its Asian business because Prudential is facing an investor rebellion over the $20bn rights issue needed to fund the deal.
The Pru's chief executive, Tidjane Thiam, and Barry Stowe, who runs Prudential's Asian operation, began a series of meetings with leading investors last week in an effort to gain their support, ahead of the vote on the cash call on 7 June. Leading fund managers remain sceptical about the deal despite the publication of a near 1,000-page prospectus delayed until last week following an 11th hour intervention by the Financial Services Authority.
The regulator gave the deal the green light after its demands that Prudential inject more capital into the deal were met.
"It's still a big leap of faith," said one investor. "Citing Asia as a blanket term for growth is simply not good enough. I wouldn't fancy being in Tidjane's seat at the moment because whether he gets the rights issue through is in the balance. If it fails, he goes."
Another institution said: "This deal is too expensive. It needs more than a smile from the boss and tinkering around the edges."
With many top investors doubting Prudential's ability to reach the 75 per cent support threshold needed to pass the rights issue, one fund manager warned Mr Thiam against "doing a Gordon Brown".
"If they fail to get 75 per cent then the top management should all walk," said one top 20 Prudential stock holder. "If they get more than 50 per cent and try to get the deal passed in some other way then there will be an almighty backlash in the City."
Investors are likely to agitate for a break-up of the business should the deal to buy AIA fail.