Prudential's Asian takeover threatened

British insurer Prudential failed yesterday to get US rival AIG to cut the $35.5 billion takeover price for its Asian unit, threatening a huge deal already facing a shareholder revolt.

The rebuff piled fresh pressure on Prudential's chief executive officer Tidjane Thiam as he scrambles to salvage his high stakes gamble to transform the 162-year-old British company into an international insurance powerhouse.

Prudential, which had asked AIG to cut its price for AIA to $30.375 billion, said in a statement that its board was "considering its position" after the rejection.

Separately, American International Group said in a terse statement that "after careful consideration, the company will adhere to the original terms of its previously announced agreement".

"The company will not consider revisions to those terms," it added.

If successful, the takeover would be the biggest-ever in the insurance sector, transforming Prudential into the world's top non-Chinese insurer by market capitalisation, ahead of major competitors Allianz and AXA.

Investors welcomed the news, sending Prudential's share price soaring 3.88 per cent to 562.5 pence in late morning trade on London's FTSE 100 index of top companies, which was down 2.27 per cent at 5,070.45 points.