AIG accelerates bid to make its P&C operations an independent entity

American International Group, Inc. (AIG) is accelerating steps to position AIU Holdings as an independent entity in preparation for the sale of a minority stake in the business.
Under the plan announced on Mar. 2, AIU Holdings — a holding company for AIG’s commercial insurance, foreign general insurance (including Canadian operations) and private client group units — was established, with a board of directors, management team and brand distinct from AIG.
AIG is now planning to transfer the company to a special purpose vehicle (SPV) in preparation for the potential sale of a minority stake in the business.
The move may ultimately include a public offering of shares, depending on market conditions, an AIG release says.
Under the SPV arrangement, AIG intends to contribute the equity of AIU Holdings into an SPV in exchange for preferred and common interests in the SPV, the release continues.
AIG also intends to purchase from AIU Holdings its equity interests in International Lease Finance Corporation, United Guaranty Corporation and Transatlantic Holdings Inc.
“The sale of these interests to AIG further separates the property casualty operations from AIG and its other affiliates,” the release says. “Moreover, the sales clarify the businesses of AIU Holdings, improve the quality of its capital, and help position the company for continued success in the future.”