Britain's Prudential Plc said on Wednesday it is withdrawing from its agreement to buy AIG's Asian life insurer, AIA, after the two sides failed to renegotiate terms of the deal.

Prudential <2378.HK> said that if the deal is terminated, it will not proceed with a rights offering in London and Hong Kong designed to raise money to finance the deal.

It estimated the cost of the AIA transaction so far at about 450 million pounds ($659 million).

(Reporting by Michael Flaherty and Doug Young; Editing by Ken Wills)

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