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AIG to sell overseas unit to MetLife
American International Group will sell an overseas unit to rival MetLife in a $15.5 billion deal which will help AIG pay back part of a government bailout. MetLife will take over American Life Insurance Company (ALICO) for $6.8 billion in cash and $8.7 billion in MetLife stock, the two firms said in separate statements on Monday. According to The Wall Street Journal, the deal would leave AIG owning about 20 percent of MetLife. The announcement comes a week after the sale of AIG's Asian unit AIA to UK group Prudential in a $35.5 billion deal. Harvey Golub, chairman of the AIG board of directors, said the two deals would generate about $50.7 billion which will be used to repay the government bailout funds. AIG plans to use $31.5 billion in cash to repay the Federal Reserve Bank of New York, which helped bail out the company during the global financial crisis. The insurer was provided a loan of $85 billion in September 2008 which was subsequently raised to some $180 billion. MetLife chief executive Robert Henrikson said in a statement that the deal will expand the business of America's largest life insurer in Japan, the Middle East, Latin America, and central and Eastern Europe. Posted by: Fred 2010-03-09 |
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