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Prudential bosses to operate from Asia as CEO Wells retires

© Reuters. FILE PHOTO: The logo of British life insurer Prudential in London October 21, 2008. REUTERS/Stephen Hird

(Reuters) -Insurer Prudential (LON:PRU) announced a management shake-up on Thursday, setting up a new base for its top executives in Asia rather than London, as Chief Executive Mike Wells plans to retire next month.

Prudential, which provides life and health insurance, said current finance boss Mark Fitzpatrick will become interim CEO. He has requested not to be considered for the CEO position, the company said.

The company’s chief executive and financial officers would be based in Asia, a region that has already been in focus for Prudential during Wells’ tenure following pressure from U.S. activist investor Third Point.

Prudential’s Asia headquarters are located in Hong Kong, though its group headquarters are in London.

“From our conversations with investors, it is clear that the lack of an Asia-based and focused management team has acted as a drag on the stock, particularly when comparing Prudential to key Asian peers,” JPMorgan (NYSE:JPM) analysts said in a note.

“This is an opportunity for Prudential to hire or promote a manager with local relationships and knowledge.”

Over his seven-year tenure, Wells oversaw two strategic demergers. Prudential now focuses only on Asian and African markets after offloading holdings in its U.S. business Jackson last September, following spin-offs of its UK and European business, M&G, in 2019.

Hedge fund Third Point, run by billionaire Daniel Loeb, had asked the insurer to break up into two businesses in 2020 and recruit top talent in Asia, where it has had a presence since the 1920s.

The insurer is conducting a search internally and externally for Wells’ successor, the company said in a statement.

James Turner, Prudential’s chief risk and compliance officer will become the CFO, succeeding Fitzpatrick, while Avnish Kalra, chief risk officer for Prudential’s Asian and African businesses, will succeed Turner.

Shares in the FTSE 100 group were up 1.3% in morning trade on the London Stock Exchange.

About 67% of Prudential’s adjusted operating profit in 2020 came from Asia, rising 13% and boosting its overall 4% profit growth.

In Asia, the insurer entered talks in 2020 that could lead to it taking full control of its 50/50 joint venture with China’s CITIC as part of its strategy to sharpen focus on the region.

Prudential bosses to operate from Asia as CEO Wells retires

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