American International Group Inc. (NYSE:AIG) may be trying to sell American Life Insurance Company to MetLife Inc. (NYSE:MET) for more than $14 billion.
Rumors about MetLife, New York, having an interest in acquiring some of the life operations of AIG, New York, have been floating around for months, but fresh rumors of deal talks have surfaced this week in the Wall Street Journal and the New York Times' DealBook.
An Alico sale could help AIG repay the federal government for the aid provided by the Federal Reserve Bank of New York and the U.S. Treasury Department. A deal also could help MetLife continue to expand outside the United States, says Clark Troy, a senior life insurance industry analyst at Aite Group L.L.C., Boston.
"A MetLife deal for Alico at a $14 billion valuation is clearly a good deal for the U.S. taxpayer," Clark says. "Aside from supporting the $9 billion valuation for Alico, it bodes well for a future [public stock offering] or acquisition of AIG. Any profit that accrues to legacy AIG strengthens its balance sheet and increases the likelihood that it will be able to make the government whole."
