LONDON/HONG KONG: Insurer Prudential said it had reduced the cost of its failed bid for AIG's Asian unit and confirmed it has no further appetite for M&A as it reported forecast-beating half-year profit.
The botched takeover will cost STG377 million (STG1 = RM5), down from an initial estimate of STG450 million, thanks to reduced fee payments to its advisers and lower foreign exchange hedging costs, Prudential said yesterday.
Presenting its first set of results since the collapse of the AIA deal in May, Prudential - Britain's biggest insurer - also ruled out reviving its bid for Hong Kong-based AIA, and said it had no plans for any other big takeovers.
"We are focused on an organic growth strategy. Large inorganic transactions are not on the agenda," Prudential chief executive Tidjane Thiam said on a conference call, adding that the company had "ruled out" another approach for AIA.
Prudential was forced to pull its US$35.5 billion (US$1 = RM3.19) bid for AIA, aimed at giving the British insurer a commanding presence in fast-growing Asia, after its shareholders balked at the price tag and AIG rejected a lower offer.
Thiam said shareholder pressure for his resignation and that of Prudential chairman Harvey McGrath in the wake of the bungled deal had largely subsided.
"There's always a range of views, it's a diverse community.
But overall I believe we have the support of the body of our shareholders and we can only operate on that basis," he said.
Prudential also said it had an IFRS operating profit of STG968 million for the first six months of 2010, up from 688 million a year earlier, and ahead of the STG724 million forecast by analysts, according to the company's calculation of consensus expectations.
- by Business Times
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