PRUDENTIAL received clearance from the Financial Services Authority for its mammoth rights issue over the weekend and could launch the deal as early as this morning.
The prospectus for the $21bn (£14bn) cash call, which was delayed after the regulator raised fears over Prudential’s capital position, is likely to price the rights at the lower end of the expected range due to market volatility caused by Greek debt fears. Analysts predict a price of 140p per share, a 40 per cent discount to the theoretical ex-rights price of 230p.
The firm is also tipped to announce the disposal of several units after it acquires AIA in Asia for $35.5bn, in a bid to quell investors’ nerves about the size of the takeover. AIA’s Indian joint venture and Chinese business are likely to be put on the block.
Prudential boss Tidjane Thiam still faces an uphill struggle to persuade 75 per cent of investors to back the rights issue. Shareholders have been angered by poor communication, as well as Thiam’s attempt to take a non-executive role at Société Générale.