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Pru: The end is nigh for Prudential's great Asian adventure. After three months of mounting scepticism, shareholders of the UK’s largest insurer made it clear that they would only approve the acquisition of American International Group's Asian operations after a significant cut in the agreed $35.5 billion price-tag. On Tuesday morning, AIG said it was not willing to renegotiate.

The US insurer’s intransigence could be considered excessive. Markets are down since the deal was announced and the suggested 12 per cent reduction would still have valued AIA at around 1.4 times embedded value.

But Pru investors seem to think that AIG’s refusal to budge on price is a godsend. The shares were up four per cent on Tuesday morning, even though Pru will now almost certainly not more than double in size and carve out a dominant position in fast-growing Asian markets.

But Pru still has its Asian business, which it could list if valuations really are as punchy as it claimed in justifying the AIA deal. And the non-merger eliminates some big risks. The integration of two highly competitive insurance sales forces looked challenging. Also, it was not clear that regulators would let Pru reduce the capital strain of the deal by accessing capital locked down in AIA’s national subsidiaries.

A strong management team at Pru might have been able to assuage doubts. But there have been a steady stream of stumbles. Chief executive Tidjane Thiam failed to persuade the market that the price was right. He also seemed to mishandle a kerfuffle on accepting a board seat at Societe Generale. The board was perceived as not keeping Thiam in check.

Then Pru failed to deliver the much-hyped prospectus on time, after failing to satisfy the UK regulator about capital adequacy. The snub from AIG is another, bigger failure to deliver.

A change in the top team now looks inevitable. This may be unsettling. Some shareholders were prepared to support the deal just to prevent a vacuum while management was culled. But now the alternative — letting a discredited team stay in control — looks worse.