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With American International Group saved from a messy bankruptcy and in the hands of the U.S. government, early reports have Edward Liddy, the former CEO of Allstate Corp. as the likely candidate to take beleaguered insurance company's helm.
A Bloomberg story attributes the information to an unnamed "person familiar with the takeover."
Currently a partner at Clayton, Dubilier & Rice Inc.; Liddy joined the private equity firm only four months ago. He joined Allstate in 1994, acting as president and CEO until 1998; and then as chairman and CEO from 1999 to 2006. He assumed the role of chairman alone from January 2007 until joining the buyout shop. Liddy will replace AIG's current CEO Robert Willumstad. - George White See Bloomberg story See Liddy bio on CD&R website See Dealscape post on AIG bailout See Crisis on Wall Street Dealwatch CategoriesComments Deal Video
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While Liddy was CFO at Sears, the seeds were planted for the events that resulted in Sears having to plead guilty for bankruptcy fraud soon after he moved to Allstate. In 2000, Allstate fired its employee agents and allowed them to remain as independent contractors if they would sign a waiver forfeiting their legal rights to sue for being fired. The legality of the waiver has been in the courtroom (Romero v Allstate) since 2002. EEOC and AARP are supporting Romero. EEOC’s lawsuit against Allstate, if successful, could cost the insurer $2 billion, according to a 2002 article in CRAINS magazine.
It may be argued that Liddy has left his two immediate prior companies in worse shape than before he got there. I do not know how much trouble AIG is in, but I do believe he is the person to lead it out of the wilderness.