FT of big-hitting investment banks including Citigroup, Deutsche Bank, Morgan Stanley and Merrill Lynch have been brought in to help underwrite Prudential’s $20bn (£13.4bn) rights issue.
The British insurer’s three global advisers – Credit Suisse, JPMorgan and HSBC – have syndicated underwriting duties to 30 institutions for the cash call, which will go towards funding Prudential’s $35.5bn takeover of American International Group’s Far Eastern business. “Pretty much everyone who matters is there,” a source said.
It is understood the main advisers have passed on around 60 per cent of the underwriting risk in total since Monday and will split the remainder between them when the rights issue launches in May.
Asian banks including DBG?Group of Singapore are among those taking a slice of the action, but will account for a minority of the underwriting.
Singaporean sovereign wealth fund Temasek has also approached Prudential’s advisers with a view to buying a special allocation of shares through the placing, although it is not known how many it wants.
The news added to a sense of relief at Prudential yesterday. Advisers to the firm had fretted throughout Tuesday as its share price collapsed for a second consecutive day. But calm returned yesterday as its shares closed up 2.6 per cent at 500p.
Prudential chief executive Tidjane Thiam and AIG boss Robert Benmosche embarked on a whirlwind tour of Asia earlier this week, meeting key American International Assurance staff and local regulators to explain the logic of a tie-up.
Thiam returns to Britain next week for a round of crucial meetings with major shareholders. Prudential hopes the roadshow will soothe fears over the dilutive effect of the cash call.