LONDON (AP) — Britain’s financial services regulator has fined insurer Prudential PLC £30 million ($45.5 million) and censured its chief executive, over the company’s handling of a failed bid to acquire rival the Asian subsidiary of American International Group in 2010.
The fine from the Financial Services Authority centers on Prudential’s ambitious attempt to buy AIA for £35.5 billion, a bid that eventually collapsed after both parties failed to agree on a price.
The regulator said Prudential should have informed it of the deal when the two parties held a detailed meeting only weeks before news of the planned takeover emerged. The FSA also censured CEO Tidjane Thiam for playing a significant part in the decision not to contact the regulator.
“The FSA expects to have an open and frank relationship with the firms it supervises and with listed companies,” the regulator said in a statement. “It is essential that firms give due consideration to their regulatory obligations at all times.”
The FSA said it should have been informed of the deal because Prudential was planning to raise almost half the offer price — or £14.5 billion — via a rights issue of shares. That would have been the biggest ever rights issue in the U.K., a development that could have affected confidence in the country’s financial system.