It looks like the auction of American International Group Inc.'s (NYSE:AIG ) asset management business, AIG Investments, is heating up.
Bids for the business are anywhere between $400
million and $800 million for the $100 billion portfolio in the division that
manages assets for pension funds, insurance companies and wealthy individuals, said a source close to the situation. Bidders include Ashmore Investment Management, Hellman
& Friedman LLC, Rhone Group and TA Associates as well as mutual fund manager
Franklin Templeton and asset manager Southgate Alternative Investments
, according to
The Wall Street Journal.
The second rounds of bids are due out this week, a source told The Deal's Michael Rudnick. The source could not confirm the specific bidders. AIG wants to finish the sale by the end of May, but it could run into trouble if bids sink lower due to valuations of the units and personnel issues the company has been facing due to the recent controversy over
bonuses.
The auction is one of several the insurer is holding in order to
pay back the government's $180 billion loan. Here are the latest
reports on asset sale progress:
Sold:
Still for sale:
- AIG's Advisor Group division, housed within AIG's retirement services division, which consists of three broker-dealers -- SagePoint Financial Inc. of Phoenix, FSC Securities Corp. of Atlanta and Royal Alliance Associates Inc. of New York -- could sell for about $200 million. Private equity firms Clayton, Dubilier & Rice Inc. and Warburg Pincus LLC have dropped out of the bidding for AIG's Advisor Group division, leaving GTCR Golder Rauner LLC and several new bidders, The Deal's Michael Rudnick reported. However, the three broker-dealers have lost nearly 14% of their advisers since February.
- AIG's aircraft leasing unit, International Lease Finance Corp., or ILFC,
could get bids from three private equity groups: Thomas H. Lee Partners
LP, Carlyle Group and Greenbriar Equity Group LLC partnering with Onex
Corp. The second rounds of bids will be held in April, according to a Reuters article. ILFC has a book value of $7.5 billion as of Sept. 30, and bids could be around $5 billion. There could be complications with the auction because AIG has promised the buyer financing for the unit.
- It has been widely reported that AIG is in talks
to sell personal car insurance unit, 21st Century Insurance, to Zurich
Financial Services. The asset is rumored be be worth $2 billion.
- AIG Global Real Estate fund management business has around $12.4 billion in assets and $5.2 billion in equity capital. The unit could be sold
for about $9 billion. Interested bidders could include BlackRock Inc.
and Blackstone Group LP (which might be a conflict because Blackstone
is advising). Included in that is its Japanese headquarters in Tokyo,
which may bring in more than $1 billion.
- AIG Edison Life Insurance Co. and AIG Star Life Insurance
Co. are also for sale. Bidders could include: Prudential Financial
Inc., Manulife Financial Corp., Allianz Group, Aegon NV, Nippon Life
Insurance Co., Tokio Marine Holdings Inc., Gibraltar Life Insurance Co.
Ltd., T&D Holdings Inc. and Manulife Life Insurance Co. The value
is estimated to be around $1 billion.
The sale of AIG's Alico, Philamlife unit and AIA were all scrapped after the government's last bailout. - Maria Woehr
Also see:
AIG's ILFC may get bids from PE
Will AIG go down in flames?
Zurich may drive off with AIG unit
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