AIG Unloads Russian Bank Subsidiary to French Bank
(NEW YORK, NY) -- American International Group, Inc., (AIG-NYSE) the federal government's poster boy for bailout rescue money, continues to sell off non-core assets, as ordered by the Treasury Department.
AIG has received a total $180 billion in taxpayer rescue funds to date. That's the largest amount the Fed has approved for any failing corporation so far.
The once high-flying New York City-based insurance conglomerate announced today it has contracted to sell 98 percent of the shares in its consumer finance operations in Russia.
Terms of the deal were not immediately disclosed. The deal needs a final OK from the Central Bank of Russia.
The Russian assets consist of OOO AIG Bank (RUS), with an option, not exercisable until mid-March 2011, for the sale of the remaining two percent, to Banque PSA Finance SA of Paris. Banque PSA is a 100 percent- owned subsidiary of PSA Peugeot Citroën Group.
OOO AIG Bank (RUS) was established in June 2008 and currently has a staff of 12.
AIG is selling assets to repay about a dozen separate government loans.
AIG previously announced it expects to close a deal shortly to sell two of its life insurance businesses. That would repay $25 billion of its total loans provided by U.S. taxpayers.
Once the world's largest insurer by market value, AIG nearly collapsed last year because of losses from credit default swaps, a bet on the credit-worthiness of other issuers.
Deutsche Bank acted as financial advisor and Debevoise & Plimpton served as legal counsel to AIG on this transaction. CMS in Russia served as legal counsel to Banque PSA Finance.
PSA Finance provides financing for sales of Peugeot and Citroën cars and light commercial vehicles in 24 countries. It supports the brands' growth by offering retail and fleet customers a diversified range of financing solutions and related services, and by providing Peugeot and Citroën dealers with financing for new and used vehicles and replacement parts inventories.
AIG was trading in the $1.42 range today on the New York Stock Exchange.