AIG to sell foreign life insurance arm for $15.5bn

By James Quinn 816PM GMT 08 March 2010

Prudential is set to buy AIG"s Asian section AIA for $35.5bn (�23.6bn)

AIG, that last week concluded to sell AIA, the Asian hold up business, to Prudential for $35.5bn, has concluded last conditions for the ordering of to sell the abroad hold up and health word arm Alico to MetLife for $15.5bn.

The deal, that was voiced yesterday after weeks of heated negotiations and over a year of talks will yield AIG $6.8bn in cash, with the superfluous $8.7bn entrance in MetLife shares and options.

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The understanding will see AIG finale up with a 20pc interest in MetLife, creation it the company"s second-biggest shareholder, and giving US taxpayers who carry out 80pc of AIG"s shares a interest in a second vital US insurer.

The money will be combined to the $25bn money it will embrace on execution of the AIA sale, and equates to the uneasy insurer will be means to significantly compensate down the credit line it has with the Federal Reserve Bank of New York.

At the finish of December, AIG due $47.3bn to the US Treasury, and $47.9bn to the new York Fed.

"Both sales give AIG larger coherence to move brazen with the restructuring and rebuilding efforts," pronounced Harvey Golub, AIG"s chairman.

Like AIA, that AIG had deliberate floating in Asia, Alico had been the theme of inner discussions per a batch marketplace inventory in New York given at slightest Jul last year.

The discussions one after another in annoy of talks with MetLife over Alico, that began in early 2009 underneath former authority Ed Liddy"s tenure, and restarted in the late summer, by that point Mr Golub and AIG arch senior manager Bob Benmosche had been appointed.

Mr Benmosche ran MetLife from 1998 until 2006, and was obliged for receiving it open in 2000. However, he was not piece of the Alico sale talks.

Alico, that began hold up in Shanghai in 1921, has 20m business in some-more than 50 countries, with poignant operations in executive and eastern Europe as well as Latin America and the Middle East, and Japan and the UK.