Prudential tries to cut $35.5bn price to calm shareholders

AIG may have to float its Asian life arm AIA in Hong Kong to raise cash to repay the US government if the Prudential – which is trying to cut the $35.5bn price tag – fails to go through with the deal, the FT reports.

The Pru’s price cut demand is an attempt to win over its investors opposed to the deal. The Pru needs 75% approval from shareholders.

People close to the situation said the AIG board and the US government had yet to decide whether to accept a reduced price or scrap the deal and revert to their original plan of listing AIA in Hong Kong.

20% chance

Dow Jones reports that Olivetree Securities analyst James Chappell claims there is only a 20% chance the deal will get completed under its current terms.

The Pru’s shares were suspended in Hong Kong this morning.

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