Pru reports ‘good progress’ on UK spin-off

Prudential has recorded an overall group profit increase of 2 per cent driven by growth in its Asia business ahead of the spin-off of its  UK arm.

The group says it continues making “good progress” on the demerger in half-year results released today.

Group operating profit for Prudential sits at £2.4bn, up 9 per cent year-on-year on a constant exchange rate basis.

In the UK, M&G Prudential’s operating profits rose 4 per cent, drive by a 10 per cent growth in operating profit within its asset management operations.

Prudential confirmed it would split the business in March to focus on its US and Asian markets.

Group chief executive Mike Wells says: “We are taking the steps needed for the demerger of M&G Prudential from the group, alongside implementing M&G Prudential’s merger and transformation programme, which remains on track to meet its objectives.”

Chase de Vere profits hit by acquisition

Overall, assets under management for M&G Prudential are £9bn lower than six months ago after the £12bn sale of its annuity portfolio to Rothesay Life.

Prudential also announced a raft of changes to its senior staff last month, with M&G Investments chief executive Anne Richards to leave the company on 10 August to head up Fidelity International.

M&G Prudential chief executive John Foley will also take on additional responsibilities of being chief executive of the “key regulated entities” of M&G and Prudential UK.

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There is one comment at the moment, we would love to hear your opinion too.

  1. What has not been explained to advisers by Prudential is is the dramatic reduction in its capital value when the Prudential’s UK operation splits from the group.

    The group as a whole is currently valued at £47bn, but when the de-merger occurs the UK operation will plunge to £8bn, of which M&G will make up £7bn of this, leaving the Prudential life division in the UK worth around £1bn, with no financial backstop from the group.

    I light of this drastic reduction in their value it might be a good idea for advisers to revisit their due diligence process with the Prudential.

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