You are here:HomeNews CenterInsurance News2012U.S. Ends Majority Ownership of AIG, Earns Profit for Taxpayers

U.S. Ends Majority Ownership of AIG, Earns Profit for Taxpayers

On September 10 the Treasury Department sold approximately 554 million shares of the stock of American International Group Inc. (AIG) to the public at $32.50 a share, obtaining a total of $18 billion from one of the largest stock offerings in the aftermath of the financial crisis...
September 12, 2012

On September 10 the Treasury Department sold approximately 554 million shares of the stock of American International Group Inc. (AIG) to the public at $32.50 a share, obtaining a total of $18 billion from one of the largest stock offerings in the aftermath of the financial crisis. The government’s sale of the massive stake in AIG ends the majority ownership it has held since 2008, when it rescued AIG to relieve strains on the financial system. The government has now fully recovered the cost of its controversial bailout of AIG. Douglas Elliott, a fellow at the Brookings Institute, described the sale as another step in the government’s successful program. Jim Ryan, an insurance analyst for Morning Star Inc., said that AIG’s current management has done a remarkable job of reviving the company. The latest deal was the Treasury’s fifth sale of AIG stock since early last year and reduced the government’s ownership to approximately 22 percent, compared with 92 percent in early 2011. The price of the last sale was higher than the government’s cost basis of $28.73 a share so taxpayers will profit from the sale. AIG purchased approximately $5 billion of the shares, with institutional investors buying most of the remainder.

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