Prudential shares soar on Standard Charter partnership

 

Prudential shares hit an all-time high in early trading after the company agreed a fresh tie-up with Standard Chartered and raised its dividend by 15 per cent.

The partnership will see Prudential products sold by emerging markets lender StanChart in 11 markets including Hong Kong, Singapore, Malaysia and India.

Both companies have also agreed to “explore additional opportunities to collaborate” in other areas like Africa, where Prudential recently bought a majority stake in Ghana’s Express Life.

Prudential’s boss Tidjane Thiam is from the Ivory Coast and is keen to expand his company’s presence across the fast-growing continent.

Shares in the company rose almost 5 per cent to 1440p on the back of the announcement and the insurer’s annual results, which saw it increase operating profits by 17 per cent to £2.9 billion in 2013 with its Asian business the largest contributor at £1.1 billion.   

Thiam played down the recent volatility seen in emerging market economies since the US began to taper its money printing programme in December.

He added: “We believe that the global economic outlook is improving. However, investment markets are impacted by short-term volatility as the market adjusts to policy normalisation in the US.

"The macro-economic adjustments that we are seeing in emerging markets, partly driven by the return of robust US growth, are ultimately a net positive for these countries, the global economy and Prudential."

The group raised its full-year dividend 15% to 33.57p and said it had achieved Asia profit targets set back in 2010. In December it  listed new targets and said it was also considering moving into Saudi Arabia.

Panmure Gordon analyst Barrie Cornes placed a 1592p target price on the shares and said Prudential’s Asian operation is still undervalued.

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