Prudential demerger on track as half year profit rises
Prudential has said plans to split its UK and European unit from the rest of the business are 'progressing well' as the insurance giant posted a rise in half year profit.
The group said that it is “taking the steps needed” to separate M&G Prudential from the group and implement a transformation programme, which remains on track.
Prudential announced in March that following an in-depth review it will create two separately-listed companies, with the remaining Prudential business comprising its Asian, US and African operations and headed by the group’s chief executive Mike Wells.
M&G Prudential will be headquartered in the UK, led by its own CEO John Foley.
“Our planned demerger of M&G Prudential from the group, which will result in two separately listed companies, each with its own distinct investment prospects, demonstrates our commitment to creating shareholder value,” said Mr Wells.
“We have mobilised our internal teams for delivery, positively engaged with external stakeholders and we are making good progress.”
Half year profits at the firm rose 9% to £2.41 billion, helped by a strong performance in its insurance and asset-management arm in Asia. UK, operating profit was up 4%.
But Richard Hunter, head of markets at interactive investor, said that Asia will continue to be the stand out performer.
“The UK and Europe, which accounts for 23% of sales, has put in a decent performance given the backdrop of an increasing need for self-help in terms of UK savers.
“It is Asia, though, where the majority of growth prospects lie. Not only does the region currently account for 52% of sales, the company now has access to 70% of the Chinese population - some 1 billion people - where its ‘health and wealth’ offering continues to gain traction.”