PUK - Bailing On The U.S. Now Looks Like Prudential Plc's Best Chance For Value Creation

• Between weak rates and higher volatility leading to higher hedging costs and higher reserve requirements, Prudential plc has decided to exit the U.S. operations and focus on its Asian operations.
• Whatever capital Prudential plc can extract from the U.S. operations (Jackson National) will go toward funding growth in Asia, including a potential buyout of its China JV partner.
• Management hopes to IPO a portion of Jackson National next year and follow with a full divestment.
• Pru's Asian operations can support a mid-to-high single-digit core earnings growth rate, supporting a fair value in the mid-to-high $30's depending on the Jackson National IPO process.

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