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Pru admits to talks with Resolution

Prudential chief executive Tidjane Thiam has admitted to holding talks with Resolution’s Clive Cowdery over the sale of the insurer’s UK arm, but Thiam insists he would only contemplate a sale if the price was irresistible.

In an interview with the Daily Mail today, Thiam (pictured) says the UK is still key to the insurer, but that he would not be fulfilling his duty if he failed to speak to potential bidders.

He says: “The UK business plays a key role for Prudential. It is a provider of cash, of capital. It supports our credit rating. Without it I cannot raise any debt.”

But he confirms holding talks with Cowdery.

He says: “Everyone has. It is my fiduciary responsibility. Whenever anybody asks us about any part of our business it is my duty to look at it and determine whether it is attractive for our shareholders.”

He refused to speculate on whether the UK arm would still be part of Prudential in two years’ time.

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Comments

There are 11 comments at the moment, we would love to hear your opinion too.

  1. So the deciding factor for a deal is whether or not it’s attractive to shareholders. What about the customers? So much for TCF.

  2. The Man form the Pru – RIP

    What has regulation, sorry, the regulator, done for ‘consumers’?

    It has certainly reduced choice and continues to do so.

    So much for Hector’s “diversity”.

    And as Adam intimated, shareholders rule OK.

  3. Neil Merryweather 15th April 2010 at 11:17 am

    As CEO of a quoted business, his & the board’s principle role is to deliver best value to the shareholders, not to the customers; it’s only the few remaining mutuals who enjoy that ‘luxury’.

    Exactly the same principle should apply to the proprietary owned soccer clubs, who’s fans (i.e. customers) likewise don’t exactly benefit from any kind of TCF style approach.

    The sooner we get used to the idea that commercial organisations will act purely commercially the better.Old alliegances are gone, & won’t be coming back.

  4. Industrial branch was never perfect and of course with thousands calling door to door there was the odd rogue. This said for every individual poorly sold thousands benefitted from the advice and support from the man from the Pru. Regulation has driven C1s down into the banks where in my view the risk of being sold something less than suitable is greater than that of any industrial branch salesman. Some folk will not even bother. When 49% of the UK adult population don’t know what 49% is we have a problem – little wonder the scale of both the national and personal debt.

    Jonathan Bloomer looked to utilise the workplace as a distribution channel and Pru were well placed to capitalise on this but pressure from government and the EU around direct marketing made employers wary of being seen as given any form of advice and in essence killed auto-enrolment at the same time.

    In conclusion, the Pru has been, for some time, (aside form Pru Bond and annuities) in essence closed to new business so why wouldn’t Thiam want to sit down with Cowdery?

  5. Mr/Mrs/Ms Anonymous, you are factually correct however, in my humble opinion this selfish, insular and tunnel vision appraoch to business is one of the factors that has got us into the mess we are in.

    Greed is good expounded what’shisface in Wall Street, and looked what happened to him.

    Don’t get me wrong I love profit, I couldn’t have survived without it. But if you try look after everyone involved’s interests in the process, (shareholders, customers, staff and yes yourself), it is possible that everyone can win.

    You try running your football club without fans! Try looking after just the shareholder, who clears off and sells you out when a better deal comes along (and it always does).

    The sooner we get used to the idea that commercial organisations should act commercially, openly, fairly, productively and profitably the sooner real and sustainable business and growth WILL come back.

  6. If customers are so concerned then become Prudential shareholders and vote against it, have their say.

  7. Resolution have come out with a statement saying they are NOT in talks with Pru – why do papers always skew information?

  8. Mr Brown : I wasn’t defending the stance taken at board level by Pru, other big institutions, nor indeed proprietory owned soccer clubs – that’s just the way it is these days & to expect anything different is naive.

    As advisers, we have the choice as to who’s products (or should we now say ‘solutions’) we put forward to our clients. We should I believe do so only in recognition that most of the providers we can choose from these days will most certainly put their own [shareholders] interests far ahead of either ours or our clients. I too truly wish it weren’t so, but……

  9. If Pru sell to Resolution it doesn’t necessarily mean the end of Pru as a consumer/IFA brand – Friends Provident are still open and trading.

    Its taken a while but Pru UK now have a product range to consider, and their PruProtect products are excellent.

    I for one hope the UK business isn’t sold, and business as usual can remain.

  10. Mr Brown : I wasn’t defending the stance taken at board level by Pru, other big institutions, nor indeed proprietory owned soccer clubs – that’s just the way it is these days & to expect anything different is naive.

    As advisers, we have the choice as to who’s products (or should we now say ‘solutions’) we put forward to our clients. We should I believe do so only in recognition that most of the providers we can choose from these days will most certainly put their own [shareholders] interests far ahead of either ours or our clients. I too truly wish it weren’t so, but……

  11. Most of Pru UK’s servicing is outsourced to Capita offshore anyway so it makes sense for them to consider selling off the UK insurance arm.

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