American International Group Inc.'s (NYSE:AIG) shares are trading in the $47 range. No that's no misprint. The stock is up nearly $10 in early Thursday afternoon trading as investors are bullish on two positive developments. The first story pushing shares higher is the government's expected green light on the insurer's pay package. The second story is a report that former CEO Hank Greenberg has mended relations with the company that could lead to fresh capital for AIG, a Morningstar Inc. analyst noted.
The Wall Street Journal reported that new CEO Robert Benmosche's $10.5 million pay package has been fast-tracked for approval by Obama administration "pay czar" Kenneth Feinberg. That's certainly good news for AIG. The company is now assured it has a new CEO in place who can focus on solving its troubled CDOs and divesting more assets to repay Uncle Sam.
But it's not just the current CEO who is pushing the stock up Thursday. Investors are also seeing a bright side to a
report that Greenberg, who resigned amid an accounting scandal in 2005, is back on speaking terms with his former company. Morningstar analyst Bill Bergman says the end of the feud could mean an influx of private investment to AIG.
"Hank Greenberg has a network of associates in financial markets that would help facilitate that," Bergman told Reuters. -
Gerald Magpily
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