Experts question whether there are even enough qualified buyers out there to digest the company and its subsidiaries.ĪIG came under attack last week as investors grew increasingly concerned about the company's capital levels. The company is much larger and complex than Lehman Brothers and its assets hitting the market all at once would likely cause worldwide chaos and send values plummeting.
It pawned its North American operations to Barclays Tuesday for a paltry $1.7 billion.īut in AIG's case, the situation is even more serious. The investment bank is now forced to sell its holdings at a deep discount. Just look at Lehman Brothers, which declared bankruptcy on Monday after the federal government refused to bail it out. a Stamford, Conn.-based investment bank specializing in insurance.Īs in the case of any distressed company, sellers can't demand top dollar for their assets when they are in trouble. "It gives time for AIG to sell assets without having to put out the fire sale sign," said Stewart Johnson, portfolio manager with Philo Smith & Co.
Had the company been forced into bankruptcy, it would have to unload its subsidiaries quickly and at a deep discount. Time is what the beleaguered insurer needs to unwind its sprawling operations - it has $1.1 trillion in assets and 74 million clients - in an orderly manner. NEW YORK () - The federal government's rescue of American International Group gave the insurance titan something even more important than access to $85 billion.
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