The best time to hold out the begging bowl to existing shareholders througha 1-for-6 rights issue is: a) when the share price has spent 18 monthstrying to recover, b) when the industry globally is being hammered byinvestigations into kickbacks to brokers, or c) when new regulations areabout to change the way products are distributed.
Clearly, Pru's timing on its rights issue announced yesterday could havecome a better time. However, what is done is done, and the analysis must therefore focus onthe reasons for the action and whether this says anything about the state ofthe insurance sector in general. Competitors are not about to admit that Pru's actions have any impact ontheir daily business decisions. Yet it is interesting, for example, that the references to newEuropean-implemented rules on capital adequacy are not ruffling morefeathers. Coupled with the fact we have yet to see, for example, a full year'sw...
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