AIG Converts Blackstone Shares, Paves Way For Divestment
December 31 2010 - 11:49AM
Dow Jones News
American International Group Inc. (AIG) has converted 35.7
million partnership units in Blackstone Group LP (BX) into the same
amount of common shares that can be more easily sold in the public
market.
The shares represent an 11.7% stake in the global investment
manager. The shares, expected to be delivered on Feb. 9, is worth
$506.7 million at Blackstone's current share price.
The U.S. insurer, in a regulatory filing earlier this month,
disclosed that it had converted 10 million Blackstone partnership
units for common shares on Nov. 15. The shares were delivered and
sold on Dec. 15 for $13.41 each.
But a person familiar with the situation said AIG has not made a
decision on whether to sell. The insurer has no urgent need to
offload the rest of its Blackstone stake and will only do so if it
can get good value for AIG shareholders, the person added.
The regulatory filing was reported by Bloomberg earlier
Friday.
AIG, which still owes the government around $90 billion, has
completed or is in the progress of completing over $40 billion in
asset sales, including a stake in pan-Asian insurer AIA Group Ltd.
(AAIGF, 1299.HK) via an initial public offering and its
second-largest foreign life-insurance business, Alico, to MetLife
Inc. (MET) for $16.2 billion. The company is close to choosing a
buyer for its Taiwanese unit, Nan Shan Life Insurance Co., which
could fetch over $2 billion.
It has also announced plans to repay another $49 billion through
sales of the government's majority stake in the company, which has
an implied value of over $70 billion. Together, these amounts are
already more than enough to repay the company's taxpayer
obligations.
Spokesmen for both companies declined comment.
AIG shares rose 0.8% to $58.01 in morning trading.
-By Amy Or, Dow Jones Newswires; 1 212 416 3142;
amy.or@dowjones.com
-Serena Ng contributed to the story.
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