Tuesday, 11 September 2012 - 04:45
U.S. Treasury Prices AIG Shares at $32.50 Each
WASHINGTON--The U.S. Treasury Monday said it would sell $18 billion in American International Group Inc. (AIG) shares at $32.50 a share, making the government a minority shareholder for the first time since it bailed the company out in September 2008.
The sale, Treasury's fifth and largest so far, reduces the government's stake in AIG from to just under 22% from about 53%. At one point, Treasury held 92% of AIG's shares, but it has been steadily winding down its investment as it looks to close the book on financial-crisis rescues.
AIG closed Monday at $33.30 a share, down 69 cents, or 2%, on the day.
The price set Monday was above the government's cost basis of $28.73 a share, meaning taxpayers will earn a profit on the sale.
AIG has agreed to buy up to $5 billion of Treasury's latest public offering.
Treasury said the latest sale will mean the federal government has fully recovered its $182 billion commitment to AIG.
"Treasury and the Federal Reserve have now recovered a combined total of $194.7 billion...representing a positive return of $12.4 billion to date," Treasury said.
Treasury chose Citigroup Inc., Deutsche Bank Securities Inc., Goldman Sachs and J.P. Morgan Securities LLC to lead the offering.
At its last auction in August, Treasury sold $5 billion in AIG shares at $30.50 each.
-Damian Paletta contributed to this article.
Write to Jeffrey Sparshott at email@example.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
September 10, 2012 21:45 ET (01:45 GMT)
Copyright (c) 2012 Dow Jones & Company, Inc.