NEW YORK (
American International Group
(AIG - Get Report)
appears close to taking another incremental step toward paying off its government tab, as the market awaits details of fourth-quarter performance.
AIG is in talks with
(MET - Get Report)
to sell its Alico life-insurance unit for roughly $15 billion, according to anonymously-sourced media reports. Alico is one of two units slated for a sale or spin-off in order to pay down $25 billion of AIG's enormous debt to the federal government.
But while the insurance giant is making progress in that regard, its stock movement continues to be
less than logical
. AIG's market value represents just one-fifth of what the Alico unit is reportedly being priced at.
That may be because the market is finally pricing in the fact that shareholders don't have a meaningful stake until the entirety of AIG's $70 billion in government debt -- not including interest and dividends -- is paid off. Even then, it's unclear where stockholders will stand.
AIG has lost nearly a quarter of its market value since the start of the year, closing at $23.14 on Tuesday. The price is far from highs above $55 hit in August. Late summer was a period of frenzied purchases of so-called "zombie stocks,"
like AIG, Fannie Mae and Freddie Mac
, that have since taken a beating.
In the meantime, AIG has been in the headlines more for the government's handling of its
than for progress it is making. An article in the
New York Times
(GS - Get Report)
hard-bargaining tactics stirred controversy anew this week. But while Goldman has remained in the
for receiving one of the largest derivatives payments, of $14 billion, AIG has largely stayed out of the fray.