Carl Icahn and John Paulson scored a big win on Thursday.
The pair of billionaire investors each got a seat on the board of insurance giant AIG.
Icahn himself won’t be on the board. Instead, he’ll have one of his firm’s analysts take the seat. Paulson will have a seat.
Here’s Icahn’s announcement:
Today we reached an agreement with AIG whereby one of our analysts will join the board of directors at the upcoming annual meeting in May. I myself declined to go on the board because of my involvement in so many other companies at this time. AIG also entered into a separate agreement with Paulson & Co. Inc. pursuant to which President John Paulson will join the board at the same time. We welcome John Paulson’s addition to the board and believe his involvement will be additive, especially in that we both have stated the same goals for AIG. We commend the board for adopting a number of our recommendations over the last few months. We continue to believe that smaller and simpler is better and look forward to working collaboratively with the board and management to help catalyze a turnaround in core P&C operations, a more transparent operating structure, and the ultimate shedding of the SIFI designation. We believe that AIG stockholders will benefit from our agreement, which permits our representative to share information with our principals and consultants, subject to customary confidentiality restrictions. I hope and believe that we will work with AIG’s board to enhance value as we have done with so many other boards and companies in the past.
Back in October, Icahn sent a public letter to the company’s CEO, Peter Hancock, saying the company continued “to severely underperform” and was “too big to succeed.”
AIG nearly failed during the financial crisis and had to be bailed out by the US government. Icahn said the company had not done enough to make itself smaller since then.
In the letter, Icahn said it was a “no brainer” that splitting up the company would unlock shareholder value.
AIG recently rejected Icahn’s call to split up the company into separate businesses.
Icahn owns 42.2 million shares and Paulson owns 14.6 million shares.
The stock fell $1.87, or -3.57% on Friday, to end at $50.58 per share.
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