Pru's big shareholders turn on McGrath

17th Jun 2010 09:11

Prudential's failed $35.5bn bid for AIG's Asian business has yet to claim a boardroom scalp, though it's looking increasingly likely that chairman Harvey McGrath may be first out the door.McGrath defended his fellow directors, especially under-fire chief executive Tidjane Thiam, at a lively AGM earlier this month, claiming it was a "unanimous decision to pursue the deal and a unanimous one to pull out".But leading shareholders have shifted their sights onto the Irishman, who it's thought should have reined in his overambitious CEO, the architect of the takeover which eventually cost the insurer £450m in fees.A top shareholder thinks a new chairman should carry out a review of the board and the executive and independent directors.McGrath and senior independent director James Ross have embarked on a City charm offensive to ensure their jobs are safe. That may not be enough to save McGrath's skin, but a desire for a smooth process could see him stay around for a while yet.It had looked liked 47-year-old Thiam was on his way after it emerged last week that none of the insurer's leading shareholders had wanted to talk to him. Institutions were instead sitting down with McGrath and Ross to discuss their ideas for a boardroom clearout, while Thiam enjoyed a family holiday in Spain.The break may have done him good, letting the former finance director recharge his batteries and keeping him out of the firing line.Away from the boardroom drama, S&P Equity Research analyst Tony Silverman has upgraded the shares to 'buy' from 'hold' and raised his target price to 685p.He says the revision allows for positive comment around the AGM on sales in Asia and the US.