Newsmaker: Bitter end to man from Pru’s Asian adventure

By Clara Ferreira-Marques and Raji Menon

LONDON (BestGrowthStock) – A year ago, Tidjane Thiam was the toast of London’s normally staid insurance industry — a French-speaking high flyer with a cosmopolitan pedigree and an unlikely background as an Ivory Coast government minister.

But eight months after taking over as chief executive of Prudential Plc, his ambitious plans to take over the Asian arm of U.S.-based AIG lie in tatters and his future at Britain’s largest insurer is in the balance.

Thiam, poached by Pru from archrival Aviva in 2007 to become chief financial officer, has been the driving force behind a $35.5 billion deal to buy the Asian unit of bailed-out U.S. giant AIG, a takeover which would have turned the UK group into the largest foreign-owned insurer in Asia.

But with the deal teetering on the brink of collapse, Thiam is left badly bruised, his reputation for smooth charisma dealt a body blow after leading shareholders attacked not only the deal’s “shambolic” execution — after an unprecedented regulatory delay — but also his perceived arrogance.

He was first accused of being out of tune with investors in March, when he was forced to back out after accepting a seat on French bank Societe Generale’s board.

“It goes back to this wretched business of the execution of this whole deal which has not been a glittering success,” one large investor told Reuters.

“The extent of the lack of communication with shareholders when the whole deal was leaked was a bit odd, then there was the whole fiasco about Thiam joining the SocGen board — which was also very odd — and then we had the (UK’s Financial Services Authority) intervention.”

Another said Thiam would struggle to hold on to the top job after the Asian escapade, which may cost the insurer almost 700 million pounds ($1 billion) in break fees and hedging costs.

“If you think that you can write off 700 million pounds and say ah well, it’s all normal, then (he could stay),” the second investor said. “But I don’t. One walks.”


Pru’s Asian deal was initially attempted a year ago, under former chief executive and Asia veteran Mark Tucker, but prices were too high for a market still reeling from the financial crisis. At the time, AIG’s AIA unit would have cost roughly the same as French giant AXA.

In the end, Thiam, 47, was the man who took the acquisition forward. But the deal now looks set to be hours away from meeting the same end as Aviva’s ambitious but ultimately flawed bid for Pru in 2006, when Thiam was Aviva’s head of strategy.

A soft-spoken former McKinsey man, Thiam was appointed CEO in March last year but did not take up the job until October. The move was widely welcomed at the time.

A tall, striking figure in well-cut suits, Thiam is a very French presence in an overwhelmingly domestic British insurance industry.

He is also the first black chief executive of a FTSE 100 company — a description he tends to shirk — and was named last year the second-most influential black Briton, behind the founder of mobile operator Celtel, Mo Ibrahim.

The son of a journalist, he was brought up in Morocco and was later educated alongside France’s intelligentsia at the elite Ecole Polytechnique and Ecole Superieure des Mines. He joined McKinsey in 1986.

Thiam was lured back to Ivory Coast in the 1990s, where he served in a number of government roles, including minister of planning and development. He left the country after the December 1999 military coup forced him back to management consultancy.

Thiam, a fervent football fan and Arsenal supporter, was headhunted by Aviva in 2002, serving initially as head of strategy and later as chief executive of its European business — and named frequently as a contender for the top job.

But he was picked out by Pru in 2007 in an appointment that surprised the industry, despite an apparent lack of experience and just over a year after Aviva made an ill-fated bid for its rival. He moved into the finance director’s chair at Pru just months before Tucker’s announcement he would step down earlier than expected propelled Thiam to the top spot.

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 (Editing by Michael Shields)

($1=.6883 Pound)

Newsmaker: Bitter end to man from Pru’s Asian adventure