With two major back to back sales, company aims to streamline investment sector
American International Group (AIG) has completed the sale of its wholly owned subsidiary AIG Private Bank to a subsidiary of Aabar Investments, an investment company based in Abu Dhabi.
Under the terms of the agreement, Aabar paid AIG approximately $253 million for the entire share capital of AIG Private Bank, and purchased and assumed approximately $55m of intra-company loans outstanding to AIG Private Bank.
Edward Liddy, AIG’s president and CEO, said: We are pleased to complete this transaction, which is part of our plan for the orderly sale of certain assets to repay the loans from the US government. This is the fourth transaction we have closed in the past three weeks and it is one of 10 asset sale agreements we have reached in the past few months, despite a challenging environment. Several other transactions are under discussion, and we continue to evaluate how best to assure the continued strength and success of all of AIG’s businesses.
Recently AIG and Zurich Financial Services Group (Zurich) announced an agreement to sell 21st Century Insurance Group, the wholly owned subsidiaries comprising AIG’s U.S. personal auto insurance business, to Farmers Group, (FGI), a subsidiary of Zurich. Under the terms of the transaction, FGI will pay AIG $1.9 billion, consisting of $1.5 billion in cash and $400m in face amount of subordinated, euro-denominated capital notes backed by Zurich Insurance Company, Zurich’s principal operating unit.
American International Group claims to be the leading international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through the worldwide property-casualty and life insurance networks of any insurer.