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Prudential in negotiations to buy American International Assurance
By Ben | Published March 01, 2010
London-based Financial services company, Prudential P.L.C. is in talks over purchasing AIG’s Asian life insurance business, American International Assurance.
Although the deal has not been finalized yet, it would see Prudential buy American International Assurance or AIA for approximately US$35.5 billion; US$25 billion in cash and US$10.5 billion in stocks.
AIG had been planning on an initial public offering for AIA since late 2009, placing the business in a Special Purpose Vehicle in which the Federal Reserve Bank of New York holds the preferred interests and AIG holding all common interests in AIA. The sale of AIA would pave the way for the largest repayment of the US$180 billion that AIG received in U.S. government bailouts, with the Federal Reserve Bank of New York prepared to receive billions from the sale.
Hong Kong-based AIA has been operating since 1919 and is a major player in the Asian life insurance market with extensive distribution networks in 15 geographical markets and over 20 million policies in-force in the region. The addition of AIA’s business operations in addition to Prudential’s existing 11 million policies would make Prudential a market leader in the Asian life insurance industry.
Companies Mentioned:
AIA
AIA is a Hong Kong-based life insurance company doing business across Asia that has been in business since 1919. They service over 20 million policies through 23,000 employees and 300,000 agents throughout markets in Asia, including; Vietnam, Thailand, Taiwan, South Korea, Singapore, Philippines, New Zealand, Malaysia, Macau, Indonesia, India, Hong Kong, Mainland China, Brunei and Australia.
AIG
The American International Group is a leading international insurance organization with operations in more than 130 countries and jurisdictions globally.
Prudential P.L.C.
Prudential has been in the insurance and financial services business since 1848. Today they operate throughout the UK, US and Asia offering international health insurance and retirement planning services, supported by 27,000 employees worldwide.
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[...] the original post: Prudential in negotiations to buy American International Assurance … tags: billion-deal, companies-were, enjoy, executive, largest-insurer, operating-since, [...]
[...] be analysing the potential impact to the local insurance market resulting from the combination of AIA and Prudential. Of particular interest, whether this deal could diminish the choices of insurance products and [...]
[...] to be a growing number of trade buyers interested in targetting plans for IPOs. The announcement of Prudential Plc buying AIA from AIG is a good example of the type of interest some European companies are demonstrating, playing their [...]
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[...] momentum now that a key shareholder of the British insurer raises the prospect of opposing the US$35.5 billion deal to buy AIA Group Ltd. Financing of the deal would be partially funded by a giant US$21 billion share sale, which another [...]
[...] Financial Services Authority (FSA) of the UK have given their approval in principle for Prudential to go ahead with the US$35.5 billion (EUR 28.3 billion) deal made with American International Group (AIG) to purchase American [...]
[...] The response by investors to the first trading day of Prudential shares in Hong Kong and Singapore has been tepid, in part due to the current slump in the markets in Asia, the which augurs a possible undesired response to the big rights issue planned by Prudential with which to finance the US$35.5 billion (EUR 28.9 billion) takeover of AIA. [...]