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Published June 3, 2009 at 11:09 AM
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 American International Group Inc. (NYSE:AIG) has now found buyers for some of its real estate to pay off the government's $180 billion loan. According to reports, the insurer has reached agreements to sell 70 Pine St. and 72 Wall
St. in lower Manhattan. AIG will continue to occupy 70 Pine St. until the end of
2010, sources said, and the adjacent 72 Wall St., according to Bloomberg. The insurer will eventually move employees into
its offices at 180 Maiden Lane, according to the report. The insurer also sold off a New Jersey office building to KABR Real Estate Investment
Partners, according to Reuters. So far, the insurer has raised over $6 billion from asset sales. The assets the insurer has sold include:
- AIG Financial Products Corp. has closed the sale of two related commodity hedges for $60.5 million.
- Auto insurer 21st Century was sold to Zurich Financial Services' Farmers unit for $2 billion on April 17, and is reportedly already starting integration.
- Taiwan's Far Eastern International Bank said it plans to buy AIG's Taiwanese credit card business AIG Credit Card Co. (Taiwan) Ltd. for around 2.3 billion to 3 billion new Taiwan dollars ($70 million
to $92 million). (See Story in The Deal's Pipeline.).
There are also several asset sales still in the works:
- Singapore's Temasek Holdings Pte. Ltd., Richard Li's Pacific Century
Group and
Franklin Templeton Investments are in exclusive
negotiations to buy American International Group Inc.'s
asset-management business, AIG
Investments. A deal could be completed by the end of June, according to The Wall Street Journal. The asset management unit has about $100 billion under
management, and the insurer expects to get as much as $500 million for
the asset. There were rumors that Macquarie Group Ltd. was finalizing a bid for the unit, The Australian reports. Others interested in the unit are thought to include Ashmore
Investment Management Ltd., Hellman & Friedman LLC, Rhone Group LLC
and TA Associates, and asset manager Southgate Alternative
Investments, according to the Wall Street Journal. Religare Enterprises has also bid for AIG Investments, according to the Journal.
- 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 have dropped out of the bidding for the 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.
- The sale of AIG's aircraft leasing unit, International Lease Finance Corp., or ILFC, has stalled because potential buyers want better gaurentees, according to Reuters. The Financial Times
is reporting that the insurer has received second-round bids from
private equity firms Thomas H. Lee Partners and Carlyle Group, Onex
Corp. and Greenbriar Equity Group, as well as an unidentified third
bidder. As Dealscape
previously noted, ILFC has a book value of $7.5 billion as of Sept. 30,
and bids were supposed to come in at around $5 billion. However, Reuters
is reporting that the unit may sell for under $5 billion. The figure is
not surprising considering AIG needs to repay $100 billion in debt and
does not have the cash to meet debt obligations of $33 billion for
ILFC's operations in 2009 due to the struggling airline business
and loss of its federal commercial paper lending facility after key
credit ratings were cut. The FT reported that the
government may even extend AIG a $5 billion loan to divest ILFC, which
should just about cover the purchase for the private equity firm that
decides to buy the unit. The credit line would come from the $180
billion bailout the government has already extended to the insurer.
- The 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 up 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.
- AIG is in the process of selling about two-thirds of its stake, or around 26 million shares,
in reinsurer Transatlantic Holdings Inc. (NYSE:TRH), according to The
Wall Street Journal. The stake, which would decrease AIG's holdings in
the reinsurer from 59% to 20%, is worth $985 million, according to Reuters.
AIG plans to repay the government within three to five years. Part of that repayment will be an IPO of American International Assurance Co., which will be taken public in 2010. - Maria Woehr For more see: I-banks line up for AIG Hong Kong IPO
AIG speeds up spinoff of crown jewels
AIG to repay bailout in three to five years
AIG Dealwatch
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AIG once the world largest insurer , is trying to get secure position this time.!