American International Group sold 14 percent of the stock of its Hong Kong life insurer, AIA Group, Ltd., for approximately $6 billion on March 6. The sale leaves AIG holding about 19 percent of the stock of AIA, regarded as one of its trophy holdings before it got into financial trouble in 2008.
The shares are held in a special facility for the benefit of the U.S. government, which will get the proceeds from the sale. The facility is a special purpose vehicle created by AIG and the U.S. Treasury to hold the AIA shares in return for cash from the government.
The original special vehicle involving AIA was $25 billion, and included ALICO, since sold to MetLife. The AIA share was $16 billion; the ALICO share $9 billion. The ALICO portion was paid off as part of the effort to end the Federal Reserve Board's loans to AIG.
