American International Group Inc
(AIG) and the U.S. Treasury Department are planning a large stock offering for
the first half of 2011 which could see the government cut its stake in the
bailed-out insurer by as much as 20 percentage points, sources familiar with
the matter said.
AIG and the Treasury would both
sell stock in the offering, which could total more than $10 billion, according
to the sources.
The Treasury is set to own 92.1 per
cent in AIG after a plan that charts an eventual exit from its investment in
the bailed-out insurer closes by the end of the first quarter. AIG got a $182.3
billion taxpayer-funded aid package during the financial crisis.
An offering could come as early as
March, but the discussions are preliminary, and the exact size and timing have
not been decided, the sources said.
“We hope to be able to go to
the market with a public offering of AIG this spring, but we have work to do to
make that happen,” AIG spokesman Mark Herr said. “We are working as
diligently as we can to achieve this as quickly as possible, subject to market
“We remain committed to
executing the steps and meeting all conditions in the recapitalization agreement
as soon as possible,” he said.
The Treasury declined to comment.
The sources are anonymous because
these discussions are not public.