Prudential May IPO

Prudential Plc has filed for a potential listing of its Malaysian unit as the insurer explores options to reduce its stake in the business, people with knowledge of the matter said.

The U.K. insurer submitted an application for an initial public offering of its local subsidiary with the Malaysian securities regulator last month, according to the people. A share sale could raise about $700 million, one of the people said, asking not to be identified because the information is private.

Prudential hasn’t decided whether to proceed with the listing, and it’s still considering other alternatives like finding a buyer for a minority stake in the business, the people said.

Malaysia’s central bank has been urging foreign insurers to reduce their holdings in local firms to no more than 70 percent as it more strictly enforces ownership limits. 

The regulator earlier gave overseas firms until June 30 to cut their holdings, people familiar with the matter said last year. Singapore’s Great Eastern Holdings Ltd. and Japan’s Tokio Marine Holdings Inc. were also among those weighing deals to reduce local stakes, the people said.

There’s no certainty Prudential’s deliberations will lead to any transaction, according to the people. Prudential could wait until the new central bank governor takes office before deciding whether to proceed, one of the people said.