AIG-AMERICAN INTL GROUP : AIG starts $20bn auction of Asian unit
22 janv. 2009•10:35
AIG starts $20bn auction of Asian unit
By Francesco Guerrera in New York, Lina Saigol and Andrea Felsted in London and Sundeep Tucker in Seoul
Published: January 21 2009 23:30 | Last updated: January 21 2009 23:30
AIG, the stricken insurance giant, on Wednesday kicked off the sale of its Asian life assurance unit one of its most prized assets in the hope of raising up to $20bn to help repay the $60bn US government loan that is keeping the group alive.
The US insurer sent the sales memorandum for American International Assurance with limited information to a group of selected potential bidders, according to people close to the situation. First-round bids are due towards the end of next month.
Prospective bidders include: China Life, the worlds largest life assurer; HSBC, the UK-based bank; Prudential, the UK insurance group; as well as Prudential Financial of the US.
ManuLife Financial, one of North Americas biggest insurance groups, and Allianz of Germany have also requested information.
People close to the situation said AIG had asked interested parties to bid for 49 per cent of AIA, but said it would be willing to look at offers for all of the unit. AIG could also opt for a full listing of the division if it does not achieve a high enough price.
Any interested bidder will have to prove they can finance the acquisition, which has become increasingly difficult as credit markets have contracted. AIG is thought to be prepared to accept shares as acquisition currency.
The size of AIA could also force potential buyers to form consortiums and break up the asset among themselves. This means that the list of the bidders could change as the auction progresses.
This has to be a flexible auction, one person familiar with AIGs thinking said.
The auction of AIA, which follows last weeks opening of the sale process for AIGs US life assurance unit, is a sign of its desire to speed up the repayment of the five-year $60bn government loan. AIG came close to collapse last year and had to be bailed out twice by the US government, which now owns 80 per cent of the troubled insurer.
Edward Liddy, AIGs government-appointed chief executive, told the Financial Times recently that the company wanted to ask the authorities to renegotiate the terms of the loan once it had completed some big disposals.
Some AIG executives believe that the insurer should press for a renegotiation of the $60bn loan earlier, especially if, as expected, the US government pours more money into the banking sector in the coming weeks.
AIG and its advisers Blackstone, Goldman Sachs and Citigroup, all declined to comment.
AIA, which was built into a powerhouse by its former chief executive Hank Greenberg, is regarded as a jewel in the companys crown. Last year, it made an aggregate operating profit of about
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