Copyright 2010 SNL Financial LCAll Rights Reserved SNL Bank Weekly Northeast Edition
May 28, 2010
Report: Treasury suggests AIA IPO as alternative to Prudential deal
The U.S. Treasury Department’s chief restructuring officer, Jim Millstein, has suggested that American International Group should revert to American International Assurance’s initial public offering plan if Prudential shareholders do not approve the AIA deal, Reuters reported.
The U.S. Treasury Department’s chief restructuring officer, Jim Millstein, has suggested that American International Group Inc. should revert to American International Assurance Co. Ltd.’s initial public offering plan if Prudential Plc shareholders do not approve the AIA deal, Reuters reported May 26.
Prudential is having a tough time persuading stakeholders, who are scheduled to vote on the $35.5 billion acquisition of AIA on June 7, to vote for the deal.
Although Millstein hailed the deal as “real upside” for U.S. taxpayers, he said the Treasury was not directly asking the British insurer’s shareholders to back the Prudential-AIA combination, Reuters reported.
Millstein said AIG, which is 80% government-owned, had prepared documents for an AIA IPO in Hong Kong. However, the board in a “close call” opted for the Prudential deal.
Considering concerns and negative sentiment surrounding the AIA deal, the Treasury has been drawing up alternative plans.
The news agency quoted Millstein as saying that going back to the IPO plan will be a “very viable alternative” for AIG.
June 3, 2010