Prudential of interest to Ping An of China

by Gill Montia

Story link: Prudential of interest to Ping An of China

Prudential is rumoured to be of interest to a Chinese insurer and shares in the life and pension provider jumped again today, on speculation that Ping An Insurance has plans to take a non-controlling stake in the group.

Latest reports suggest that Ping An is close to taking a $13.8 billion stake in Prudential and the fact that the Chinese insurer is in the process of raising £5.6 billion through the sale of bonds and a share issue has heightened speculation that it could invest in the group, along with other insurers in Europe and the US.

Such a move could benefit Prudential by giving it scope for expansion in China. It already has a presence in 13 Asian markets, including China and India and last week, Sir David Clementi, Prudential’s chairman, joined Prime Minister Gordon Brown on a trade visit to the country.

The Chinese Government is currently encouraging insurers to enter into negotiations with leading Western companies and Aviva is seen as another potential target.

China Life, the country’s largest insurance group, is thought to be seeking overseas investments. While it has a stock market listing, it is still largely controlled by the Chinese Government.