LONDON: Some of Prudential’s largest investors will demand a shakeup of the company’s leadership over its handling of a botched US$35.5bil bid to take over AIG’s Asian unit, British media reported yesterday.
Fidelity, Legal & General Investment Management and Schroders will hold talks with either Harvey McGrath, the insurer’s chairman, or James Ross, senior independent director on the company’s board, Sky News said on its website.
The investors, angered by the £450mil (US$652.9mil) costs racked up by the failed deal, are set to call for an immediate recruitment process to find a replacement for chief executive Tidjane Thiam, according to Sky News.
Harvey McGrath – AFPIn a separate report, the Financial Times said members of the National Association of Pension Funds planned to meet Prudential on June 22 to discuss whether boardroom changes would be necessary.
Thiam sought to soothe investor anger at the UK-based company’s annual general meeting in London on Monday, apologising for the misadventure’s huge costs and deflecting criticism over what one investor said was a “strategic foul-up of momentous proportions.”
The Times newspaper said investors canvassed by the paper on Tuesday remained critical of the current management, but were now moving towards a push to oust McGrath over Thiam.
The investors also thought Thiam and other top executives at the Pru should waive their annual bonuses if they were to avoid further shareholder backlashes, according to the Times.
“It would be the right thing to do. They need to share some of the pain with shareholders,” the paper reported an unnamed investor as saying.
Prudential could not immediately be reached for comment. — Reuters
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