AIG sells fund units to Pacific Century for $500 million
07 September 2009
American International Group Inc. (AIG), a world leader in insurance and financial services, which was rescued from the verge of collapse by the US government's huge bailout package, has agreed to sell part of its investment advisory and asset management business to Bridge Partners L.P., a company owned by Hong Kong's private equity firm, Pacific Century Group (PCG), for approximately $500 million.
The price includes $300 million at closing, plus additional future consideration based on performance and continuing share of carried interest.
The units being sold manages close to $89 billion of assets of retail and institutional clients in 32 countries, and includes private equity, hedge fund of funds, listed equities and fixed income.
AIG would retain its in-house investment operation that manages approximately $480 billion worth assets.
AIG's senior vice president-divestiture, Alain Karaoglan, said: ''After conducting an extensive and rigorous auction process, we concluded that this transaction provides fair value for AIG and achieves the greatest long-term stability and potential for the business, its clients, business partners and employees.''
No changes are envisaged in the management of the new business as well as AIG's investment operation. Win J Neuger will remain as chief executive officer of the new business while Monika M Machon will continue in her role as senior vice president and chief investment officer of AIG, overseeing AIG's investments.