Bailed-out US insurance giant AIG announced yesterday that it will “accelerate steps” to spin off its Asian subsidiary American International Assurance (AIA) through a public listing in the region.
AIG said in a statement that AIA would have its own board of directors and management team after the listing.
It did not disclose which stock exchange it was planning to use.
INDEPENDENT ENTITY
It said it “will accelerate steps to position the AIA Group as an independent entity and seek a public listing on an Asia stock exchange for the group, depending on market conditions and subject to regulatory approval.”
The listing represents an attempt to distance the Asian insurance arm from its parent group, whose reputation has been overshadowed by a huge Washington bailout after it was battered at the onset of the credit crisis last year.
“At this stage, we believe that a public listing for AIA would be in the best interests of all stakeholders, including US taxpayers, policyholders, employees and distribution partners,” said Edward Liddy, chairman and CEO of AIG.
ROADMAP
Mark Wilson, president and chief executive officer of AIA, said the listing announcement represented a “clear and formal roadmap for our independence.”
A source told Dow Jones Newswires that up to a third of AIA would be floated on the Hong Kong Stock Exchange.
It was hoped that this would raise between US$5 billion to US$10 billion in the first quarter of next year.
Last month AIG sold its car insurance unit, 21st Century Insurance, to Zurich Financial Services Group for US$1.9 billion. The transaction is the largest divestiture by AIG since September.
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