View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. Technology
November 30, 2005

The Pru bids for whole of Egg

The Prudential has made a bid for the 21% stake in Egg it does not currently own, valuing the online bank at around GBP973 million.

By CBR Staff Writer

The insurance firm plans to give Egg shareholders 0.2237 new Prudential shares for each Egg share, a premium of 15% to Egg’s closing price on November 28, 2005. Egg’s independent committee will recommend that investors accept it.

The combined strength of our Prudential UK, [fund manager] M&G and Egg businesses provides the group with significantly greater opportunities across the spectrum of personal financial services in the UK than is available to them operating in isolation, said Prudential’s chief executive, Mark Tucker.

But there are likely to be other costs. The Prudential is aiming to save GBP40 million a year through the Egg deal by the end of 2007, at a cost of GBP50 million to be taken a year earlier. Analysts expect Prudential will want to knock nearly 17% off Egg’s current cost base.

Despite this, Egg’s chief executive, Paul Gratton, reckons the deal has potential for revenue growth. There are considerable opportunities to grow Egg’s revenues and profits within the Prudential Group, which will give us access to nearly 2.8 million additional marketable customers, he said.

Content from our partners
Unlocking growth through hybrid cloud: 5 key takeaways
How businesses can safeguard themselves on the cyber frontline
How hackers’ tactics are evolving in an increasingly complex landscape

Websites in our network
Select and enter your corporate email address Tech Monitor's research, insight and analysis examines the frontiers of digital transformation to help tech leaders navigate the future. Our Changelog newsletter delivers our best work to your inbox every week.
  • CIO
  • CTO
  • CISO
  • CSO
  • CFO
  • CDO
  • CEO
  • Architect Founder
  • MD
  • Director
  • Manager
  • Other
Visit our privacy policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.