Tidjane Thiam, the incoming chief executive of Prudential, is probably the only insurance executive to have been the victim of a coup d’état – in his native Ivory Coast. The question in the City on Thursday was whether he had orchestrated his own boardroom coup at the Pru.
Mark Tucker, the outgoing chief executive, insisted his decision to step down was “entirely personal”.
He added he would be remaining as chief executive until September. Insiders say he had always indicated he would step down after five years (though in fact it is only four years since he started in the job). He will not be receiving any pay-off.
Mr Tucker believes he made a mistake when he left the Pru’s Asian arm in 2003 not to have a successor lined up. “I was determined, coming back here, not to do that, and my first job was finding a successor,” he said. Mr Thiam was hired as finance director, from rival Aviva, in 2007.
But Mr Tucker’s assurances did not silence the conspiracy theorists.
The semi-official explanation by some company insiders was Mr Tucker was loath to stay in his job after the Pru had pulled back from its attempted purchase of the Asian operations of American International Group, put up for sale in a $20bn (£13.8bn) auction.
Mr Tucker’s passion is Asia, where he spent nine years building up – by means of organic growth and acquisition – a leading position in the region, although his record was tarnished by problems at a business he bought in Taiwan.
People familiar with the situation say the Pru’s interest in AIG cooled because of the values being demanded for the business, which it could not justify given its financial discipline.
There was also talk on Thursday that the Pru may have been forced to elevate Mr Thiam to prevent him returning to Aviva, where he spent five years, and where top management is under pressure. However, this theory is denied by both sides and one person familiar with Aviva described the scenario as “extremely far-fetched”.
Some other Pru-watchers pointed to the arrival of the new chairman Harvey McGrath as the catalyst for Mr Tucker’s departure, but Mr Tucker insisted on Thursday they had a good working relationship.
Whatever the exact circumstances, Mr Tucker will now look to his next role. His first choice would be a position in Asia, although one person who knows him suggested he may explore opportunities in football. He is a passionate Chelsea supporter and has attended every World Cup final since 1966.
Mr Tucker appears to be leaving the Pru in a strong position. It reported a pre-tax loss under international financial reporting standards of £2.07bn compared with a pre-tax profit of £1.06bn last time. But it had £1.7bn of surplus capital, rising to £2.5bn after a deal to sell off policy liabilities in Taiwan.
Nonetheless, for some investors, Mr Tucker will always be associated with having resisted their calls to break up the group, either by selling off the mature UK life business, or by floating the faster-growing Asian operation.
Mr Thiam says he is comfortable with the strategy, but there are hopes among some investors he will be more willing to take an axe to the group that spans the UK, the US and Asia. Mr McGrath also leaves the door open to a change in structure.
At Aviva, he showed himself willing to take radical action. As strategy director he helped spearhead the company’s failed bid for the Pru almost exactly three years ago, and its £2bn acquisition of US life assurer AmerUs a few months later.
He was also keen, along with Mr Tucker, to buy AIG’s Asian assets.
Even running Aviva’s continental European arm he made small acquisitions and signed a series of bancassurance deals.
“It’s a bold choice,” said one seasoned Pru watcher.
A person who knows Mr Thiam said he appeared to have made “a good fist” of the finances at Prudential. One institutional investor said he had been impressed by the level of disclosure under Mr Thiam at the results presentation on Thursday.
“I thought Tidjane was good,” he said. “They went into [things like]: ‘If you want to see what is the scenario that busts the group?’ They were ruthless in running through asset-by-asset and saying: ‘Look where we are at.’ So for the assembled audience there was not a lot to [criticise].”
Some question whether Mr Thiam has the leadership and operational experience.
The performance of Aviva’s continental European arm under his stewardship was mixed, although his supporters argue this was a disparate business in need of melding together.
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