By Chief Market Strategist Nicholas Santiago on March 1st, 2010 11:14am Eastern Time
This morning the tax payer owned American International Group, Inc. (NYSE:AIG) agreed to sell one of it's most valuable assets; it's Asian life insurance business to Prudential PLC for $35.5 billion. The deal includes AIG receiving $25 billion in cash, $8.5 billion in equity and equity related securities, along with $2 billion in preferred stock for its American International Assurance Ltd unit. American International Group is in the hole to the U.S. government for $182.3 billion for the recent bailouts.
After selling one of their most valuable units, many are wondering what AIG has left in asset terms to move back into profitability. In this deal AIG will get a stake in Prudential and can always sell those shares down the road. Currently AIG looks like a controlled liquidation as they could be in the works to sell another unit to MetLife, Inc. (NYSE:MET) for approximately $50 billion.
This deal today has been announced while the markets around the world are all positive. The London FTSE 100 (INDEXFTSE:.FTSE) is trading higher by 43.00 points to 5395.00, the French CAC 40 (INDEXEURO:.FCHI) is trading higher by 46.00 to 3755.00, and the Dow Jones Industrial Average (INDEXDJX:.DJI) is trading higher by 66.00 points to 10,392.00.
Nicholas Santiago
Chief Market Strategist
InTheMoneyStocks.com
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