The U.S. Treasury Department said that it has sold and priced 206.9 million shares in beleaguered insurance giant American International Group at $29 per share, below yesterday’s close.
The news has sent AIG stock down more than two per cent.
At that price, the Treasury would raise some $6 billion.
AIG agreed to purchase about half of the offering, or 123 million shares.
“We’re continuing to move forward to wind down TARP and exit our stakes in private companies as soon as practicable,” said Assistant Secretary for Financial Stability Tim Massad. “Today is another important step in our efforts to recover the taxpayer’s investment in AIG.”
Yesterday, the Treasury announced that it would also raise $8.5 billion from AIG after the company completed the sale of its unit that included Asian crown-jewel AIA, reducing its stake in AIG to $37.8 billion.
At its peak, the government backed AIG to the tune of $182 billion, including a still unredeemed loan from the New York Federal Reserve of $9.3 billion. All together, outstanding obligations owed to the federal government has fallen to 25.8 per cent of the original bailout.
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