Although US insurer AIG (NYSE: AIG) plans to hold on to its foreign general insurance businesses, it will try to sell many of its assets in its American Life Insurance Company (ALICO) operations, CEO Edward Liddy told a conference call.
"AIG plans to retain its US P&C and foreign general insurance businesses and keep a continuing ownership interest in its foreign life insurance operations," the company said in a related statement.
"Literally, everything else that doesn't fall under that is up for sale," Liddy said during the call.
Asked what the statement regarding foreign life operations meant, Liddy explained it referred to Asian life insurer American International Assurance Company AIA, in which the company hopes to sell a minority stake.
"There are other businesses we have outside the US, primarily our Alico operation," he said. "Those businesses we will offer for sale."
ALICO includes operations in Argentina, Brazil, Chile, Colombia, Mexico, Panama, Peru, Uruguay and Venezuela through a mix of wholly owned subsidiaries and joint ventures.
Another business with offices in the region that would appear to be up for sale is reinsurer Transatlantic Holdings (NYSE: TRH), in which AIG holds a 59% stake. Subsidiary Transatlantic Re operates in reinsurance, construction insurance and surety bonds out of São Paulo.
AIG has hired The Blackstone Group (NYSE: BX) and JP Morgan (NYSE: JPM) to coordinate its asset sales, the statement said.
On the news, ratings agency AM Best left AIG and its subsidiaries' financial strength ratings, issuer credit ratings and debt ratings unchanged and under review with negative implications.
"AM Best maintains heightened sensitivity to the possibility of erosion of franchise value and employee departures, which would have a detrimental impact to profitability," it said in a statement, noting that profitability could be affected by reduced client confidence and market conditions.
Since accepting a US$85bn lifeline from the federal government, AIG has been expected to provide a list of assets up for sale. AIG has two years to pay off this loan, of which it had drawn US$61bn as of September 30.
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