Rinse, wash, repeat. AIG (AIG) wants to make changes, yet again, to its ever-evolving bailout from the federal government (us). This time, it wants more flexibility on how it can dispose of its assets:
FT: People close to the situation said AIG was looking at instalment payments and other flexible options in an effort to make it easier for potential buyers to bid for assets and increase its chances of surviving as an independent company. The moves, being considered by AIG’s management, are aimed at boosting competition for the disposals and countering the perception that the company will be forced to sell units at bargain prices to repay the government aid.
Under the current deal with the Fed, which has bailed out AIG twice this year – most recently in November, extending the rescue package to $150bn – the insurer can sell assets only to bidders paying at least 90 per cent of the price in cash.
How can the feds say no to anything at this point? We can’t let AIG fail and let our whol $150 billion deal go down the toilet. And look, AIG says the scheme is to raise more money than the current deal allows, so who could argue with that.
One smart move on AIG’s part: Yesterday, the company said it had rescinded a 1.05 million share grant to ex-CEO Robert Willumstad. At this point, that’s not much money, but it’s a smart PR gesture nonetheless.