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AIG Bailout: Breaking Up Is Hard to Do

"The value of a franchise that specializes in aircraft leasing is going to go up or down with the cycle," says Hartwig. "But the point is, it's a large and valuable franchise."

But the question is, when will those assets rebound? Time is precious for AIG, which is also looking to part with hundreds of other less-prized subsidiaries. Just within AIG Capital Corp. are 21 subsidiaries, which have 34 subsidiaries under those, and another 25 subsidiaries under that, and so forth. Joe Paduda, a former director of marketing in AIG's managed-care subsidiary, says the last time he counted, AIG was 280 different companies, but may whittle down to 50 once all is said and done.

Paduda, who is now a principal at managed-care consulting firm Health Strategy Associates, was asked what AIG might look like after selling off non-core assets.

"I'm not sure how to answer that because I'm not sure what AIG is," he responds. He later adds, "AIG is so convoluted and has so many cross-business relationships and intercompany transfers, it is byzantine. I was in president's meetings a decade and a half ago, and it was byzantine then. You'd have to get the big blue supercomputer to figure it out now."

That dynamic adds difficulty in structuring deals that would dismantle one division, and also makes the government less interested in controlling the firm, Paduda says. In better times, AIG would have been able to sell entire blocks of business to private players, or offer ownership stakes, but unfortunately, none of those plans seem to be working out.

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