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Thanks for sharing this statement BBD….it is v clear….I am sure there Pru will sell some nto the buy back…it makes sense to do so as otherwise there will be a 10% seller in the market which is a recipe for a sharp fall.

Surely just a coincidence BBD.

I would expect Pru to tender enough shares to keep to 19.9%. And do the sell down in the market.
It would be shoddy to force a lot of UK shareholders to sell at 25-27 and then stitch up a cosy deal for Pru at 34.

Thanks for your support BBD and Candid
I wished to add that not all is doom and gloom at MNG.
ESG credentials are being put to the fore.
Investment performance seems to be improving. Institutional cash flow is positive as these should be more critical investors this is encouraging and a lead indicator that retail business will return in time.
Prufund has been remarkably successful and is maturing at over 50bn AUM. As it matures it will throw off more cash to the shareholder as all shareholder cash flows are back ended.
Annuities need capital and as the book runs down at 2-3% pa it releases capital which becomes available to the shareholder….the bump caused by covid will accelerate this in the short term.
The run off of heritage savings business creates WP terminal bonuses and more shareholder cash. THis cash gives management options to pay down debt, invest in the business or pay dividends if they can’t invest it more profitably.

The acquisitions of ascentric and sandringham are in the wealth business which carries a higher valuation multiple than asset management or life and pensions. Making a success of this business will be a key element of MNG in 10 yrs time. I predict more acquisitions in this space.

Prufund in Europe (and why stop there) will eventually happen. It must be nearly ready to go.

I think the current 200p level is a good entry point, particularly within a tax efficient wrapper. The dividend should protect or compensate for potential downside….if the acquisitions go well and the growth in AUM returns then there is the prospect of a rise in the share price too.

Overall MNG has a place in my portfolio…..providing a good yield on a high single figure % of my investments.

JXN not stopping for breath….up over a dollar today, presently $36.24
This is what buybacks are meant to do….
In the UK there would be a daily RNS about own shares…..does anyone know what reporting there is in the US?

Hopefully they will be available to playback. If not could attendees feedback on any news and interesting responses to questions.

Looks like BoA was buying for Elliot….stake of 7% confirmed.

All the major asset owners have holdings in each other and these are held in client funds rather than as holding company assets, so I doubt there is any intention of making a bid.

I am surprised by the size of the holding in Investec at around 11%. However, M&G has recently made PPMSA a majority owned subsidiary rather than minority ownership. This might have meant the UK and SA funds need to report on a combined basis.

I always felt the predominantly UK holders of JXN would be treated poorly as near forced sellers. The brave and lazy ones have been rewarded with a 35% gain.
In my view JXN is still under valued, remember Apollo bought in at a $5bn valuation less than 2 years ago….even now still only 3bn valuation……plenty of room to grow back into.

Ping an is reeling under bad debts of construction companies.
If they pay in cash I will take the money, but I would not take paper from them.

I have not seen the Hsbc note but it is evident that the current holding company cash will pay the dividend until 2023. It will need topping up with dividends from the operating companies.

My post about concerns seems to have gone into the ether…..I have one word for you Growth is my concern

Assets under management need to grow substantially to negate margin erosion in the asset management side.
Growth is needed to create a scale wealth business
Prufund in Europe is needed to replace heritage run off business
Investment performance is needed to drive new asset growth
Pensions admin needs to be sorted out to stop haemorrhaging Business

Look out for signs of growth.

The 3m chart is a little worrying 7 til you realise the sp has gone nowhere for 3m and then dipped a couple of %. Chart makes it look like a precipice

Surely it has to be Nic Nic who gets appointed….ex group cfo, currently ceo Asia.

Probably both….and persuade a client to make a bid.

There is a NANETS a poster on the company website….but it looks identical to a previous poster apart from a new header.

Re dividend funding….we need to do some work as it is not explicitly set out.
Looking at the YE presentation in March there are various slides to reference

Underlying profits and capital cash remittances come from the operating businesses.

Capital generation from annuities and WP….showing 400-500m pa for the next decade.
Asset management was a £300m contribution and is facing into margin pressures.

Corporate cash position is where the dividend is paid from…

Current dividend costs about £450m. If this is 70% of underlying profits they have to be £650m. Dividend for 2020 was 57% of Adjusted Operating profit so there is some margin before there is pressure on the dividend.

Is the dividend sustainable?
It certainly is if the capital generation plan is met so that covers a few years.

Adverse market movements could have an effect. The sensitivity analysis of the capital position to certain shocks will give you an idea of how much the markets would need to fall to hit potential dividends…..an SCR below 150% would start to impact dividends so there is a large margin of safety in current market conditions.

That said….a new CEO may want to rebase the dividend to invest more in the business. I doubt mgmt would have set the dividend so high if they thought they would be one of the highest yielding shares ont eh FTSE. It is a difficult situation to change unless there is clear growth in the underlying business.

Overall, I think mgmt would say they intend to keep the dividend at its current level with modest increases. The investor presentations are useful in this respect as they do show how mgmt will fund the business and dividends….watch for changes several years out they indicate the dividend payout % is rising if it gets above 70% it is getting less sustainable.

Is MNG getting stronger?
The capital position is stronger and the capital generation target has been raised which indicates management confidence. The new business is now designed to be capital light which should mean low capital s needed to fund new business, the run off of the annuity book naturally generates capital each year which is earmarked for debt repayment so the debt ratio will fall over the next decade.
The savings and asset management business are more stable being effectively a fee x asset value less costs. These are geared to markets and delivering investment performance to grow the assets being managed. MNG has not performed well over the last few years but mgmt seems to be saying it’s investment performance Is improving.

Overall I would say the company is getting stronger and the results more resilient. However growth is not yet seen in assets under administration or management…..so any growth story needs to be proven which may be why the sp has been rather flat.

Karv

The solvency 2 capital ratio is the total of capital (surplus assets over the best estimate of liabilities) divided by the risk margin. It shows the value of assets over and above that needed to meet the regulatory minimum.
Assets and liabilities are both v large numbers and are assessed against the best estimate.
The best estimate of liabilities is the value generated by using the central actuarial assumptions.
Risk margin (your 5.4bn) is what is needed over the best estimate liability to cover liabilities for an estimated 99.5% of potential outcomes produced by the SII models which are approved by the regulator.
Annuities feature heavily here because investment returns could be lower than assumed when pricing the annuity and people with annuities may live longer than expected.

On the assets side quality of assets is important. Firms like MNG, LGEN, AV using a bespoke SII model, will want to operate at SCR of 160-180%. An SCR around 200% indicates there is headroom to pay out dividends to shareholders, reduce assets by debt retirement and share buy backs.
The quality of assets is an important consideration.
Debt in the form of bonds issued by the company are included

TMTP is an adjustment between previous solvency and solvency 2 requirements and reduces until it is zero in about 10 years time. This is a transitional credit that is not a real asset hence some analysts would exclude this, but annuity companies needed this to survive under SII regime which requires a lot more capital than previous regimes….neither is correct, it is just that SII provides higher levels of guarantee that the company can meet its liabilities.
The 3.3bn present value of future shareholder transfers represents how much the WP fund is worth to the shareholder (£200-250m for the foreseeable future discounted to today). It is a large number extrapolated into the future and discounted back….it is a real asset that the company could sell (at a discount).

Sorry I have forgotten what your q was

Apparently Pru is looking for a replacement for Mike Wells [sunday Times).
Worthless article……might appoint a woman, might appoint a Chinese, might base in HK….

Current analyst target prices reported on yahoo finance number three and must be 30,34 and 38.
They will all be revising their numbers now the market is moving up.
In my view JXN on a bid basis has 50% upside but you are v unlikely to see that.
USD 30-35 is a likely range for a while but what do I know about what is happening in US Fnancial services….diddly squat.