Prudential's takeover of AIA collapses

It was meant to be a deal that would make Prudential the undisputed leader in Asia's life insurance industry and more than double the UK-based insurer's pre-tax profits by 2013. But yesterday, the confirmation finally came that its high-profile acquisition of AIA Group, the Asian life insurance business wholly-owned by American International Group AIG, had fallen apart and will not happen.

The collapse had been brewing for some time and began to look like a distinct possibility when it emerged that Prudential had last week asked AIG for a reduction in the acquisition price from the originally agreed $35.5 billion to $30.4 billion. Quite predictably, AIG issued a statement late Tuesday saying it...