Investors in Pru target chairman

 

Leading Prudential shareholders are calling for the head of chairman Harvey McGrath and will vote against his re-election at the annual meeting on May 19.

Prudential CEO Tidjane Thiam

All Prudential's directors, including McGrath and chief executive Tidjane Thiam, have put themselves up for re-election following last year's failed attempt by Prudential to acquire rival AIG's Asian business AIA.

Though the insurer's performance has improved sharply since then, investors said the flawed takeover strategy and £377m spent on the bid raised concerns about the chairman's ability to run the Pru.

A top 20 shareholder said: 'We are going to vote against the re-election of the chairman and we may not be alone in that. It's a reflection of how we feel the bid was handled. A sense of injustice remains.'

Another of the insurer's 20 biggest shareholders said anger resulted from a lack of communication over Prudential's bid for AIA, adding: 'We weren't told of the strategy in the first place.'

The fund manager said he thought the level of dissent would be considerable, but added that he expected McGrath to be re-elected.

Another leading investor in the Pru said that, despite 2010's fullyear profits rising by a third, much of the work had been undertaken by Thiam's predecessor, Mark Tucker, who now runs AIA. 'The bonus should have been paid to Mark Tucker, not Tidjane,' he said.