NEW YORK — Prudential Securities Inc., the fifth-biggest U.S. broker, plans to eliminate 160 investment-banking jobs in New York, reducing its effort to manage initial public offerings and advise on corporate mergers and acquisitions.
The decision followed a review led by Chief Executive John Strangfeld, who replaced Hardwick Simmons in October. Prudential already announced the firing of 425 people in its fixed-income trading and underwriting business.
"Our business won't be driven by the needs of issuers, but will be focused on the needs of institutional and private-client investors," said Stephen Massey, president of Prudential-Bache International in London.
Prudential is retrenching in the mergers and underwriting businesses where it lags rival firms. The company ranked No. 32 among mergers advisers this year after finishing 29th in 1999, according to Bloomberg data. In equity underwriting, the unit of Prudential Insurance Co. of America is 18th this year behind China International Capital Corp.
Prudential Securities will continue to focus on U.S. stock market research and building its European equity research business by hiring more analysts, Massey said. "We want to provide advice-driven independent research," he said.
The company will keep an investment-banking and corporate finance unit run by Simon Gill, he said. The job cuts in investment banking were earlier reported by the Financial Times and the Wall Street Journal.
The reorganization of the securities business is occurring as parent Prudential Insurance prepares to sell shares to the public for the first time.
With an offering, Prudential will follow insurers Boston-based John Hancock Financial Services Inc. and New York-based MetLife Inc., both of which sold stock earlier this year. Shares of John Hancock and MetLife have doubled since their IPOs.