AIG (AIG) Higher Ahead of Q3 Results
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American International Group (NYSE: AIG) shares are leading the financials today
ahead of the company's highly-anticipated third quarter results on Friday November 5, 2010 at 7AM.
The upside also following news yesterday that the U.S. Treasury is looking at a profit on its loans and investments given to save the company. A truly remarkable feat.
The announcement by the Treasury follows AIG's announcement that they have raised about $36.71 billion to payback the U.S. through a $20.51 billion IPO of AIA Group Ltd. on the Hong Kong Stock Exchange, and the $16.2 billion sale of Alico Co. to MetLife (NYSE: MET).
Per the plan for the government to unload their AIG shares, the company plans on drawing up to $22 billion from the Treasury's TARP to acquire interests in Alico and AIA from the Federal Bank of New York. The Treasury will then take over those interests, and doesn't expect to incur a loss on them.
Upon completion of the transactions, the Treasury will hold a 92% stake in the company, which will be valued at about $69.5 billion, which significantly exceeds the $47.5 billion cash investment that the Treasury currently holds.
Restructuring of AIG is expected to complete in Q111.
The news would also be a boon for hedge fund giant Bruce Berkowitz, whose Fairholme Capital recently disclosed an increased stake in AIG from 26.6% to 27.7% of their outstanding common shares (which is the percentage before the government stake converts into Common Shares).
Shares of the insurer are up about 3.9% in morning trading, well ahead of peers like Chubb (NYSE: CB) and Progressive (NYSE: PGR), who are trading marginally higher today.
ahead of the company's highly-anticipated third quarter results on Friday November 5, 2010 at 7AM.
The upside also following news yesterday that the U.S. Treasury is looking at a profit on its loans and investments given to save the company. A truly remarkable feat.
The announcement by the Treasury follows AIG's announcement that they have raised about $36.71 billion to payback the U.S. through a $20.51 billion IPO of AIA Group Ltd. on the Hong Kong Stock Exchange, and the $16.2 billion sale of Alico Co. to MetLife (NYSE: MET).
Per the plan for the government to unload their AIG shares, the company plans on drawing up to $22 billion from the Treasury's TARP to acquire interests in Alico and AIA from the Federal Bank of New York. The Treasury will then take over those interests, and doesn't expect to incur a loss on them.
Upon completion of the transactions, the Treasury will hold a 92% stake in the company, which will be valued at about $69.5 billion, which significantly exceeds the $47.5 billion cash investment that the Treasury currently holds.
Restructuring of AIG is expected to complete in Q111.
The news would also be a boon for hedge fund giant Bruce Berkowitz, whose Fairholme Capital recently disclosed an increased stake in AIG from 26.6% to 27.7% of their outstanding common shares (which is the percentage before the government stake converts into Common Shares).
Shares of the insurer are up about 3.9% in morning trading, well ahead of peers like Chubb (NYSE: CB) and Progressive (NYSE: PGR), who are trading marginally higher today.
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