Prudential up on rumours of M&G sell-off
Friday 23 August 1996
Analysts pointed out that a speedier sell-off would allow the Pru to concentrate on a sudden takeover bid for Woolwich Building Society, itself preparing for a pounds 3bn stock market flotation next year. Buoyed by the market talk, the insurer's shares closed up 17p at 442p.
When Peter Davis, the Pru's group chief executive, announced the partial flotation of the reinsurance subsidiary, he dampened down takeover fever by suggesting that his company wanted to get the Mercantile deal out of the way first. Mr Davis suggested the likely float date, markets permitting, would be in late autumn.
One analyst, who would not be named said yesterday: "You mark my words. The company is clearing its decks for the Woolwich bid. I expect an announcement within three months. But I'd rather not have my name printed in case I'm wrong, thank you."
The amount raised would go towards financing the bid for Woolwich Building Society, although it was not strictly necessary since the Pru would have no problem raising the funds needed to do so.
A Prudential spokesman refused to comment on rumours of an early Mercantile & General sell-off.
The sale of Mercantile & General, worth about pounds 1.2bn in total, follows a strategy review of the entire Prudential group, which has led the company to decide to concentrate on retail financial services and associated fund management activity.
M&G is one of the world's major reinsurers, operating in more than 100 countries. In 1995, the company wrote gross premiums of pounds 1.3bn and contributed pounds 196m, almost 25 per cent, to the group's pre-tax profits of more than pounds 800m.
In June, Mr Davis said that while the Pru's primary aim was to seek a listing for about half the company, if a suitable offer for the entire business were to be made, it would be considered carefully.
The Pru is preparing to launch its own telephone-based mortgages and retail savings operation. It hopes to build significantly on the more than pounds 700m in mortgage business it currently places each year with a panel of other lenders.
But it has made no secret that it is in the market for a suitable building society or even a mutual life insurer in pursuit of its UK retail strategy.
Jo from Northern Ireland was less than impressed by Russell Brand's attempt to stage a publicity stunt
- 2 Harry Potter fans can apply to the Hogwarts-inspired College of Wizardry
- 3 Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
- 4 Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
- 5 Orange Wednesdays are no more
Weather bomb in pictures: Storms cuts power for tens of thousands – and snow is on the way
Jessica Chambers: 19-year-old woman 'doused with lighter fluid and burned alive' in the US
Russell Brand calls Nigel Farage 'poundshop Enoch Powell' in BBC Question Time debate
Russell Brand was rendered speechless on Question Time by this man
Fury at Airbus after it hints the super-jumbo may be mothballed
Nigel Farage: Me vs Russell Brand on Question Time – he's got the chest hair but where are his ideas?
Shock poll shows voters believe Ukip is to the left of the Tories
Disgruntled RBS worker writes hilarious open letter to Russell Brand after anti-capitalist publicity stunt leaves him hungry
New era of cheap oil 'will destroy green revolution'
Ukip founder Alan Sked and Nigel Farage 'begged Enoch Powell to stand as a candidate'
Ukip candidate jokes about 'shooting peasants' in racist and homophobic rant
iJobs Money & Business
£40000 - £470000 per annum + bonus: Ashdown Group: Java Developer / J2EE Devel...
£45000 - £55000 per annum + Benefits: Ashdown Group: An exciting opportunity h...
$125 - $175 per annum: Carlton Senior Appointments: Senior Wealth Manager In...
$200 - $350 per annum: Carlton Senior Appointments: Managing Producer Office...