AIG Shares Tank on Report of Restructuring

The nation's No. 1 insurer is considering jettisoning its aircraft-leasing unit, <I>The Wall Street Journal</I> reports.
Author:
Publish date:

AIG (AIG) - Get Report plans to unveil a major restructuring plan by early Monday morning that will likely include the sale of its aircraft-leasing unit and other assets, The Wall Street Journal reported on its Web site Sunday.

Managers at the nation's No. 1 insurer were trying to put together the plan Sunday afternoon and present it to the company's board for approval, the

Journal

reported, citing people familiar with the situation.

AIG, which has already raised $20 billion in fresh capital in 2008, was also talking to several private equity firms about getting more capital and was hoping to raise more than $10 billion, the

Journal

added.

In addition to its aircraft-leasing arm, AIG was considering selling off assets related to property and casualty insurance, the

Journal

reported.

The reported moves come after a dizzying 31% drop in AIG's stock price Friday driven by investor worries that the company lacked sufficient capital.

Late Friday, Standard & Poor's warned that it could slash AIG's credit rating on concerns that the insurer will have trouble getting fresh capital quickly, the

Journal

noted.

AIG shares, which finished Friday's session at $12.14, were down $6.10, or 50%, to $6.10.

This article was written by a staff member of TheStreet.com.