Prudential plc

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Prudential

Type	Public (LSE: PRU, NYSE: PUK)
Founded	1848
Headquarters	London, England, UK
Key people	Harvey McGrath, (Chairman) Mark Tucker, (CEO)
Industry	Financial services
Products	Life insurance
Revenue	£18,993 million (2008)
Operating income	£(2,074) million (2008)
Net income	£(391) million (2008)
Employees	28,000 (2008)[1]
Website	www.prudential.co.uk

Prudential plc (LSE: PRU, NYSE: PUK) is a United Kingdom-based financial services company. The company has over 21 million customers worldwide^[1]. As well as the UK arm of its operations it has operations in 12 countries in Asia and owns Jackson National Life in the United States. It founded the Egg internet bank, which it sold to Citigroup in 2007. It is listed on the London Stock Exchange and is a constituent of the FTSE 100 Index.

[edit] History

The Company was founded on 30 May 1848 in Hatton Garden in London as The Prudential Mutual Assurance Investment and Loan Association providing loans to professional and working people.^[2]

In 1854 the Company began selling the relatively new concept of industrial branch insurance policies to the working class population for premiums as low as one penny through agents acting as door to door salesmen. The army of premium collection agents was for many many years identified with the Prudential as the "Man from the Pru".^[2]

It moved to its traditional home at Holborn Bars in 1879^[2] and converted to a limited company in 1881.^[2] The building was designed by Alfred Waterhouse, and is built of terracotta manufactured by Gibbs and Canning Limited of Tamworth (c.1878) – two of the same driving forces behind the Natural History Museum in London.

The Company was first listed on the London Stock Exchange in 1924. In 1997 the Company acquired Scottish Amicable, a business originally founded in 1826 in Glasgow as the West of Scotland Life Insurance Company, for $1.75bn.^[3]

Holborn Bars - Traditional home of Prudential

In 1998 Prudential set up Egg, an internet bank within the UK. The subsidiary reached 550,000 customers within nine months but had difficulty achieving profitability.^[4] In June 2000 an initial public offering of 21% was made to allow for further growth of the internet business but in February 2006 Prudential decided to repurchase the 21% share of Egg.^[5] Egg was subsequently sold to Citibank in January 2007.^[6]

In 1999, M&G, a UK fund management company, was acquired.^[7]

In June 2000 the Company was first listed on the New York Stock Exchange to help focus on the US market.^[8]

In October 2004 Prudential launched a new subsidiary, PruHealth, a joint venture with Discovery Holdings of South Africa selling Private Medical Insurance to the UK market.^[9]

In April 2008 Prudential outsourced its back office functions to Capita: about 3,000 jobs were transferred (1,000 in Stirling, 750 in Reading and 1,250 in Mumbai).^[10] This significant outsourcing deal worth an estimated £40m for an initial three year period built on Prudential's existing relationship with Capita who took over its Belfast operation in 2006 along with approximately 450 employees in a smaller operational restructure.^[11]

On 7 April 2009, it was announced that Prudential was in talks with Manchester United regarding becoming the English football giant's shirt sponsor in 2010.^[12] However, on 3 June 2009, Manchester United announced that it had signed a four year shirt sponsorship deal with American insurance giant, Aon Corporation. The deal is said to be worth £80 million over four years, replacing United's deal with AIG as the most lucrative shirt deal in history. In 2010, Aon will replace troubled American insurance company AIG, which is restructuring itself having received a $150 billion (£109 billion) bail-out from the U.S. government.^[13]

[edit] Operations

Prudential's administrative centre in Reading

The Company has four business units:^[14]

• Prudential UK: the business offers pensions, annuities, savings and investments (bonds, ISAs). They are particularly well-known for the sale of with-profit bonds and pensions, corporate pension schemes, bulk annuities and individual annuities. The company left the general insurance (household, car) market in 2002, licensing Churchill Insurance (now part of the Royal Bank of Scotland group) to use the Prudential name.
• M&G: the business offers investment management services including retail fund management, institutional fixed income, pooled life, pension funds, property and private finance. Part of M&G, Prudential Property Investment Managers specialises in the management of Prudential's property assets.
• Prudential Corporation Asia: the business is the largest UK life assurer in Asia. It has had a presence in the continent since 1923 when an overseas agency for life assurance was created in India. Although this was subsequently nationalised, Prudential has recently relaunched in India as ICICI Prudential, a 26% joint venture with ICICI Bank. As CITIC Prudential Life, a 50-50 joint venture, they were the first UK company to re-establish life business in China in 2000. There are also businesses in Hong Kong, Taiwan, Japan, South Korea, Singapore, Malaysia, Philippines, Thailand, Vietnam and Indonesia.
• Jackson National Life: the business was purchased in 1986. It was named after Andrew Jackson, the seventh President of the United States of America and started business in 1961 at Jackson, Michigan.

[edit] Prudential Assurance and Prudential Financial

Prudential Assurance Company Ltd, now part of Prudential Plc, was for many years the dominant life assurance company in the UK.

It was agents from the Pru who, on deciding to leave Prudential and move to the United States, were given access to all the techniques of the firm to assist them in forming an insurance firm in America. That infant company went on to become Prudential of America known as The Rock. There was never a significant ownership link between the two Prudential companies although there is a memorandum of understanding about use of the Prudential name around the world.

[edit] Management

There are currently 13 people on the board of directors. Key individuals are:

[edit] See also

• Prudential Financial - Indirectly related US based company

[edit] References

[edit] External links

Wikimedia Commons has media related to: Prudential plc

• Prudential plc web site
• ICICI Prudential Life Insurance Company Ltd (India)
• Yahoo! - Prudential plc Company Profile
• Prudential UK web site
• PruHealth web site
• Prudential Corporation Asia

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