This morning AIG (AIG) confirmed it had secured a sweetened bailout deal from the government, scrapping the original, high-interest bridge loan. But AIG isn’t done! It’s already scheming to come up with a more shareholder-friendly plan. We were incredulous when we heard that on this morning’s conference call, but a check of the transcript confirms that that’s a goal.
The setup is that John Levin of Levin Capital asked if there were any way to restructure the new deal, so as to give AIG more upside if the securities they’re transferring to the government improve markedly in value. The response:
Edward M. Liddy – Chairman and Chief Executive Officer
Yes, John right now, the deal is… what the deal is, not fixed in concrete forever (emphasis added). As you can see the movement we made from the first transaction to the second one, is a rather quantum improvement. We’ll continue to do everything we can to put AIG in the best possible position. What these two arrangements do is they stop the cash out flows for the most part.
John Levin – Levin Capital
I agree with you and congratulate you on that. (!)
There you have it. For all to hear, CEO Edward Liddy and investor John Levin are already high fiving each other on how they might stick it to taxpayers even more, wresting more cash for shareholders. As long as equity holders are left hanging around, it’s inevitable that they’ll keep trying. More reason they should have been wiped out long ago.
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