IPO / ROUNDUP: Prudential plans to list US subsidiary Jackson in 2021

LONDON (dpa-AFX) – British life insurer Prudential plans to list its US subsidiary Jackson National Life on the stock exchange next year. By mid-2021, the group intends to part with a minority stake in Jackson in this way, Prudential announced when the half-yearly figures were presented in London on Tuesday. After that, the group wants to gradually sell its remaining Jackson shares.

The Prudential share rose after the news on the London Stock Exchange in the morning by more than three percent. Since the turn of the year, however, the paper has still lost around twelve percent.

Prudential boss Mike Wells decided, under pressure from major shareholders, to completely align his company to the growth markets in Asia and Africa. The hedge fund Third Point of the activist US entrepreneur Daniel Loeb urged management in February to split the remaining group into the US division Jackson and the Asia business PruAsia.

Since then, the Prudential leadership had spoken of bringing a minority stake in Jackson public. In addition, the management has since explored a partial sale off the stock exchange. But now a complete separation from Jackson is also part of the plan.

Prudential intends to use the proceeds from the IPO to expand its business in Asia and Africa. Prudential has already spun off its UK division M&G. Since last fall, their shares have been traded separately under the name M&G. Prudential justified the separation with the fact that M&G and the rest of the group had different market opportunities and strategies.

Most recently, Prudential clearly felt the consequences of the corona pandemic. In the first six months, the net profit slumped compared to the same period last year by around three quarters to 534 million US dollars (454 million euros).

Because of the restrictions resulting from the pandemic, the life insurer’s new business – measured in terms of annual premium equivalent (APE) – was 45 percent lower in the second quarter than a year earlier. In the first half of the year, the decline was 34 percent.

In Hong Kong, business collapsed by 64 percent in the first half of the year due to the travel restrictions in place for customers from mainland China. In China itself, where the restrictions to contain the virus were imposed earlier and were also relaxed earlier, the decline in business was much less pronounced at five percent. After a slump in the first quarter of the year, new business in the second quarter was even a fifth higher than a year earlier./stw/eas/men

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