It's no secret that American International Group Inc. is going through a major makeover. To oversee this change, the hobbled New York-based insurer hired Paula Rosput Reynolds as vice chairman and chief restructuring officer, and Richard Booth, previously senior vice president and chief administrative officer, was named vice chairman of transition planning and CAO. Both new hires will play key roles in remaking AIG so it can repay its government bailout.
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Reynolds' major responsibility will be to oversee the mammoth task of managing the divestiture of assets and serve as chief liaison with the Federal Reserve Bank of New York. Meanwhile, Booth will be responsible for restructuring AIG's corporate center, overseeing the separation of companies being sold by AIG and executing AIG's transition to its new organizational structure. The two will certainly have their hands full as the company announced Friday it burned through $90.3 billion of the Federal Reserve's $122.8 billion loan.
AIG has been in the spotlight over the last few weeks since taking on the Fed's loan and preparing for asset sales to pay it back. Sadly, the reality is the insurer is in a difficult position. With credit still tight, some potential buyers, who otherwise would tap credit lines to complete a deal, are left out of the bidding. Whoever can afford a deal has the advantage and may force AIG to sell at bargain basement prices.
Nevertheless, AIG, so far, has received some interest for its Asian assets, which include Philippine American Life and General Insurance Co. If a deal does go through in the coming days, it will just be a tiny piece that will be needed to pay back its gigantic credit line. - Gerald Magpily and Baz Hiralal
See Bloomberg article
See Dealscape: U.K.'s Pru definitely has eyes for AIG's Asian assets
