Benzinga | Jan 28, 2021 05:28AM EST

Prudential To Demerge US Business As Separate Entity, Raise $3 Billion Equity

* Prudential PLC (NYSE:PUK) is set to demerge Jackson, its U.S. business unit as a separate entity, the Financial Times reports. The move will break-up the 173-year-old life insurer to focus on Asia.

* The insurance giant had been under pressure from activist investor Third Point to split up and unlock shareholder value.

* Prudential will demerge the Jackson unit directly to shareholders instead of an initial public offering (IPO) but retain a 20% stake in the company.

* Post the split, Prudential will be a U.K.-headquartered business with operations in Asia and Africa with stock market listings in London and Hong Kong.

* Jackson will list on the New York Stock Exchange once the deal is concluded in the second half of 2021.

* Prudential is raising new equity between $2.5 billion to $3 billion to pay down its debt. The new equity is likely to be marketed to Asian investors as the company wants to increase its shareholder base in the region.

* Price Action: PUK shares are down 6.96% at $33.97, in the pre-market session on the last check Thursday.