Prudential Asset Management, which opened an office in the Dubai International Financial Centre in December last year, has agreed a memorandum of understanding with Saudi-based Aljazira Bank to set up a new takaful – Islamic insurance – company in the Kingdom. Under the memorandum, Prudential will be the largest shareholder in a joint venture company with Aljazira Bank’s life insurance business, Takaful Taawuni. It is intended that the new company will ultimately list on the Tadawul, Saudi Arabia’s stock exchange. As a part of this deal, Prudential is also taking a stake in Aljazira Bank’s new fund management business. The funds JV will manufacture local equity and sukuk products, while Prudential aims to sell its Islamic funds range via Aljazira. Once it received regulatory approval, the JV will seek both takaful and fund management licences. Suraj Mishra, Prudential's Dubai-based chief executive, said the deal should be finalised by the end of the year. The fund management JV is to be based in Jedda, although no name has been decided. Mr Mishra recently added Dubai to his remit whilst continuing to oversee the firm’s Hong Kong retail and Singapore businesses. Prudential intends to manufacture its own funds in Dubai, and has provisional approvals to sell offshore funds, introduce traditional products into the DIFC and the United Arab Emirates, and to manufacture Islamic funds.