New SPV will hold insurance assets including UK firm
AIG is to hive off AIU Holdings into a special purpose vehicle (SPV) independent company to make selling it easier.
AIG said it would initially sell a minority stake in the business, but ultimately its plans “may include a public offering of shares”.
AIU Holdings will serve as the holding company for AIG’s commercial insurance, foreign general insurance, and private client group units.
“Placing AIU Holdings into an SPV marks the latest significant step to position our strong insurance companies as independent businesses, which will benefit all stakeholders, including policyholders, employees, and distribution partners,” said Edward Liddy, chairman and chief executive of AIG.
The move includes separating out the property and casualty businesses into the new AIU Holdings, and passing back to AIG non-core businesses, such as leasing firms.
AIG said: “The sale of these interests to AIG further separates the property casualty operations from AIG and its other affiliates. 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.
“Taken together, these actions accelerate the move of AIU Holdings toward greater independence,” said Kristian Moor, president of AIU Holdings. “Securing the value of these well capitalised insurance companies, which had net written premiums of about $36bn in 2008 serving millions of clients around the world, is in the best interests of policyholders and the American taxpayer. We are very excited to begin this new chapter in the life of one of the world’s pre-eminent global insurance organisations.”
