LONDON (dpa-AFX) - Third Point LLC, which holds about 5% of outstanding common shares of Prudential plc (PRU.L), urged the company to separate its Asian and United States operations to increase investment in both businesses, optimize growth, and drive higher valuation.
Meanwhile, Prudential, which recently spun out its European insurance and asset management businesses into a new company called M&G Plc, confirmed that it has received a letter from Third Point.
The company looks forward to commencing a dialogue with Third Point with regard to the views outlined in its letter. The company also noted that it will provide an update on the Group's performance and strategy at its full-year results on 11 March 2020.
In the letter to the Board of Directors of Prudential, Third Point said that the comppany's two separately managed franchises, Prudential Corporation Asia and Jackson National Life, have distinct strengths but share no discernable benefit from being operated under the same corporate umbrella.
Third Point also urged Prudential to eliminate duplicative 'Group Head Office' costs, which Third Point estimates to be about 200 million pounds per annum, creating significant upside to earnings.
The New York-based hedge fund also asked the company to eliminate the redundant UK footprint and move the primary headquarters for PruAsia to Hong Kong, and for Jackson to Michigan.
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