SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the month of January, 2007
PRUDENTIAL PUBLIC LIMITED COMPANY
(Translation of registrant's name into English)
LAURENCE POUNTNEY HILL,
LONDON, EC4R 0HH, ENGLAND
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or Form 40-F.
Form 20-F X Form 40-F
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes No X
If "Yes" is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b): 82-
Enclosure: Sale of Egg Banking plc
Embargo: 10.45am Monday 29 January 2007
Sale of Egg Banking plc
Prudential plc ("Prudential") announces that it has entered into a binding
agreement (the "Agreement") to sell Egg Banking plc ("Egg"), Prudential's UK
banking business, to Citigroup.
Under the terms of the Agreement, the consideration payable to Prudential by
Citigroup is GBP575 million in cash, subject to adjustment to reflect any change
in net asset value between 31 December 2006 and completion.
Prudential has also agreed in principle outline terms with Citigroup with
respect to a UK distribution agreement through which Prudential will provide
life and pensions products to Egg's customer base for a five year period. This
distribution agreement will preserve the strategic benefits to Prudential of
access to Egg's direct distribution model and its customer base of over 3
million.
In addition, Prudential announces that it has been selected as a strategic
provider to Citigroup for the distribution of life insurance products to
Citigroup's consumer banking customers in Thailand, Indonesia and the
Philippines.
The transaction is subject to regulatory approvals and is expected to complete
by the end of April 2007.
The sale will enhance EPS in 2007. The proceeds will be used to reduce net debt.
The transaction is expected to improve the Group's surplus under the Financial
Conglomerates Directive by an estimated GBP300 million.
Commenting on the sale, Mark Tucker, Group Chief Executive of Prudential, said:
"The sale of Egg to Citigroup realises greater value for our shareholders than
retaining the business within the Group. Citigroup is the largest credit card
issuer in the world and sees enormous opportunities to develop Egg's business in
the UK."
For the financial year ending 31 December 2006, Egg's operating losses on
continuing ordinary activities before tax are estimated to be GBP145 million.
As at 31 December 2006, Egg's gross assets and shareholders' funds are estimated
to be GBP9.5 billion and GBP276 million respectively.
ENDS
Enquiries:
Media Investors/Analysts
Jon Bunn +44 20 7548 3559 James Matthews +44 20 7548 3561
William
Baldwin-Charles +44 20 7548 3719 Valerie Pariente +44 20 7548 3511
Steve Colton +44 20 7150 3136
Notes to Editor:
1. There will be a conference call today for wire services at 11.30am (BST)
hosted by Mark Tucker, Group Chief Executive, and Philip Broadley, Group Finance
Director. Dial in telephone number: +44 (0)20 8609 0205. Passcode: 155439#
2. There will be a conference call for investors and analysts at 12.00am (BST)
hosted by Mark Tucker, Group Chief Executive, and Philip Broadley, Group Finance
Director. From the UK please call +44 (0)20 8609 0205 and from the US 1866 793
4279. Pin number 487687#. A recording of this call will be available for replay
for one week by dialling: +44 (0)20 8609 0289 from the UK or 1 866 676 5865 from
the US. The conference reference number is 160468.
3. About Egg
Launched by Prudential in October 1998, Egg is an innovative financial services
company, authorised as a bank by the FSA and providing a range of banking and
financial services products that are distributed via the Internet and phone. Egg
has no branches.
Egg focuses on offering banking products and services, specifically, personal
loans, credit cards, mortgage loans, and deposit and savings accounts through
its operational subsidiaries.
4. About Prudential
Prudential plc is a company incorporated and with its principal place of
business in the United Kingdom, and its affiliated companies constitute one of
the world's leading financial services groups. It provides insurance and
financial services directly and through its subsidiaries and affiliates
throughout the world. It has been in existence for over 150 years and has
GBP237.5 billion in assets under management as at 30 June 2006. Prudential plc
is not affiliated in any manner with Prudential Financial, Inc, a company whose
principal place of business is in the United States of America.
Forward-Looking Statements
This statement may contain certain "forward-looking statements" with respect to
certain of Prudential's plans and its current goals and expectations relating to
its future financial condition, performance, results, strategy and objectives.
Statements containing the words "believes", "intends", "expects", "plans",
"seeks" and "anticipates", and words of similar meaning, are forward-looking. By
their nature, all forward-looking statements involve risk and uncertainty
because they relate to future events and circumstances which are beyond
Prudential's control including among other things, UK domestic and global
economic and business conditions, market related risks such as fluctuations in
interest rates and exchange rates, and the performance of financial markets
generally; the policies and actions of regulatory authorities, the impact of
competition, inflation, and deflation; experience in particular with regard to
mortality and morbidity trends, lapse rates and policy renewal rates; the
timing, impact and other uncertainties of future acquisitions or combinations
within relevant industries; and the impact of changes in capital, solvency or
accounting standards, and tax and other legislation and regulations in the
jurisdictions in which Prudential and its affiliates operate. This may for
example result in changes to assumptions used for determining results of
operations or re-estimations of reserves for future policy benefits. As a
result, Prudential's actual future financial condition, performance and results
may differ materially from the plans, goals, and expectations set forth in
Prudential's forward-looking statements. Prudential undertakes no obligation to
update the forward-looking statements contained in this statement or any other
forward-looking statements it may make.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Date 29 January 2007
PRUDENTIAL PUBLIC LIMITED COMPANY
By: /s/ Jon Bunn
Director of Public Relations