Third Point Partners said Monday it had built up a sub-5% position in Prudential that makes it the British insurer’s second-largest shareholder and called for a breakup of its U.S. and Asian operations.

In a six-page public letter released Monday, the New York-based fund said Prudential Corporation Asia and Jackson National Life “have distinct strengths but share no discernable benefit from being operated under the same corporate umbrella.” The activist said a separation would “increase investment in both businesses, optimize growth, and drive higher valuation.”

Third Point said its analysis showed that shareholder value could double in three years with a separation, better capital allocation, and cost-cutting. It also said opportunities existed to increase the company’s stake in its China joint venture and rationalize non-economic hedging in its U.S. business.

“Using appropriate trading multiples on embedded value and earnings, we think a standalone PruAsia would be worth well in excess of Prudential plc’s current market capitalization, implying that the market is assigning a deeply negative value for Jackson,” Third Point CEO Dan Loeb wrote in the letter.

Prudential confirmed receipt of the letter later on Monday.

“Prudential proactively engages with shareholders with regards to Group strategy and structure, and looks forward to commencing a dialogue with Third Point with regard to the views outlined in its letter,” it said.

In October, the company listed its European arm, which comprises an insurance business carrying the Prudential name, and its M&G investments business, under the name M&G plc.

While largely complimentary about Prudential, Third Point did criticize the lack of Asian experience in the insurer’s executive ranks – something it felt might be caused by the “redundant cost base some 6,000 miles away from PruAsia’s local headquarters in Hong Kong.”

In a side note, Third Point also addressed the outbreak of coronavirus, or Covid-19, saying that while this might cause onlookers to question the timing of the breakup, “a viral outbreak reminds us of the need for health and protection products in Asia, a region with 3.6 billion consumers and little existing coverage.”

Shares in 36.5 billion-pound market cap Prudential were down 4.6% at the market close on Monday amid a worldwide stock market rout linked to the economic impact of coronavirus. Third Point’s press release came out after the market close.

“Standing alone, PruAsia can focus 100% of its efforts and investment on supporting customers and its talented network of agents,” Loeb argued.

Shriti Vadera, a one-time adviser to former British Prime Minister Gordon Brown, was named as a future chair of Prudential in January. She is currently chair of Santander U.K. and a director at BHP, a target of Elliott Management, but will give up both positions before taking the chair at Prudential.

London-based Prudential plans to update shareholders on its strategy at its full-year earnings on March 11.

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