Prudential Says No Resignations Were Called For By Fidelity

21st Jun 2010 16:53

By Vladimir Guevarra Of DOW JONES NEWSWIRES LONDON (Dow Jones)--U.K. insurer Prudential PLC (PRU.LN), which is facing a backlash from some shareholders over the failed $35.5 billion acquisition of American International Group Inc.'s (AIG) Asian unit, said Monday that no resignations were called for during its meeting with Fidelity International Ltd., one of its top investors. "The meeting today between Fidelity and Chairman Harvey McGrath was a cordial, open and considered exchange of views. In particular, and contrary to recent widespread media speculation, no specific resignations were called for," a spokesman said. The comments come after reports over the weekend said Fidelity would ask for McGrath's resignation. The topics discussed Monday included the cancellation of the AIA deal and Prudential's business strategy going forward. There is a GBP450 million cost attached to the failed deal, worth nearly as much as the GBP503 million the company paid in dividends last year. Since the cancellation of the offer for AIA Group Ltd., there have been persistent reports that some shareholders are still asking for the resignations of McGrath and Chief Executive Officer Tidjane Thiam. Former City Minister Paul Myners, former Zurich Financial Services CEO James Schiro and former Prudential CEO Mark Tucker have been reported as possible choices to replace McGrath. Michael McLintock, CEO of M&G Investments, Prudential's investment management arm, has also been reported as a choice to replace Thiam. Recent reports said Schroders Investment Management, Fidelity International and Legal & General Investment Management, which are among the top 20 investors in Prudential, were planning to meet McGrath or senior independent director James Ross. The National Association of Pension Funds is also expected to meet McGrath on Tuesday. David Paterson, NAPF's head of corporate governance, said two weeks ago: "The NAPF and a group of its members are due to meet with the Prudential later this month. We are not planning to suggest specific changes, but we are looking to discuss the long-term interests of the business and its recent challenges to institutional investors, including pension funds." Some members of the NAPF are also investors in Prudential. Prudential's discussions with large institutional shareholders follow a contentious annual meeting earlier this month, where several retail shareholders called for management changes at Prudential. Many of the retail shareholders felt that the board had failed to properly grasp their opposition to the aborted AIA deal, and were angry about the costs incurred in pursuing the transaction. - By Vladimir Guevarra, Dow Jones Newswires. Tel. +44 (0) 2078429486, [email protected] (END) Dow Jones Newswires June 21, 2010 11:53 ET (15:53 GMT)