AIG Hastens Spinoff Of Life Insurance Unit
Thursday, July 16, 2009
NEW YORK, July 15 -- American International Group is speeding up plans to spin off its American Life Insurance Co. unit as an independent public company, the company said Wednesday.
The beleaguered insurance giant, now 80 percent owned by the U.S. government after receiving $182.5 billion in loans, said in March that it would spin off Alico, as the unit is called, and a second unit, American International Assurance, known as AIA Group.
The United States was given a $25 billion preferred stake in the two units in June. While planning to spin off Alico, AIG has also been in discussions with MetLife over the possible sale of all or part of the unit. Those talks continue.
A spokesman said AIG is simultaneously moving forward with plans for an initial public offering for Alico. "We are determined to pursue an IPO path for this company to get it out from under the AIG brand as quickly as we can," said spokesman David Monfried. AIG will be naming a board for the company and taking other necessary steps to move Alico toward independence.
He could not say when an IPO might be scheduled. No further information was filed with the Securities and Exchange Commission as of late Wednesday.
In June, AIG said it was placing Alico and AIA Group into special-purpose vehicles ahead of planned IPOs. As part of the plan, the Federal Reserve Bank of New York received preferred interests in those SPVs. That move was intended to cut AIG's outstanding debt owed on a credit facility with the Federal Reserve Bank of New York to $15 billion from $40 billion. AIG previously said it also plans to spin off AIU Holdings, its property and casualty insurance business.
The announcement came after the close of financial markets Wednesday. Shares of AIG fell 10 cents to close the regular session at $14.22, despite a broad market rally.
Resource:
http://www.washingtonpost.com/wp-dyn/content/article/2009/07/15/AR2009071504015.html |
