NEW YORK ( TheStreet) -- American International Group ( AIG) has made huge strides toward repaying its government debt, but that doesn't mean shareholders should prepare for a near-term independence rally.

In the past couple of weeks, AIG has locked down deals to sell two major insurance units for a total of $51 billion, which will go toward repaying roughly the same amount of debt to the Federal Reserve Bank of New York. The insurer will sell its Asian life insurance unit, AIA, to Prudential Plc ( PUK) for $35.5 billion, and its foreign life insurance unit, Alico to MetLife ( MET) for another $15.5 billion.

Because the deals are comprised of both cash and stock, it will take a while for the Fed to fully recoup its investment. It will have to sell its stakes in AIA and Alico to the market over time to avoid pushing down prices, but at least it has a definitive plan in place. The Treasury Department's investment is a little less certain.

The Treasury invested $47 billion into AIG, most through the issuance of preferred stock. There's also a credit line that the firm has drawn on periodically to fill balance-sheet gaps. All of that would need to be paid down, with deferred interest and dividends, either through cash flows of AIG's core casualty and property division, by raising capital through new stock offerings, or by converting the Treasury's preferred stake into common and selling that to the market.

Looking at the math, it appears the Treasury's exit will either take a really long time, or need to come at a loss.

As far as cash flows go, AIG booked an $8.9 billion loss last year. While much of the loss came from special items, operating results declined in all but one division, as premiums dropped across the board: Down 14% at the core property and casualty division, Chartis; down 30% at the U.S. life and annuity division, SunAmerica; down 8% in the foreign life and annuity division.

Of course this doesn't mean AIG will never generate money -- pre-tax operating income was over $8 billion -- but the firm is still clearly making progress toward digging itself out of a hole.

If the Treasury wants to tap the market for reimbursement, the outlook isn't much better. AIG's current market cap stands at under $3.8 billion, and it owes 12 times that much, not including fees, or what it will cost to extinguish an open credit line. It makes the massive conversion of the Treasury's preferred Citigroup ( C) stake into common stock look like chump change.

AIG has undeniably come a long, long way from where it was at the height of its bailout -- $180 billion in committed funds, or $134 billion in dispersed funds, depending on the math used. Its accomplishments under the new CEO Robert Benmosche are remarkable, when one considers the huge debt burden and operational difficulties AIG was facing when he took the helm.

"This sale is an important step toward repaying the government," AIG Chairman Harvey Golub said in a statement on Monday, later adding that both the AIA and Alico divestitures "give AIG greater flexibility to move forward with our restructuring and rebuilding efforts, and focus on enhancing the value of our key insurance businesses."

But implicit in such statements is what's left out as well. AIG executives have made extensive comments in support of employees, and defending their compensation. They have outlined immediate plans to start repaying the government, with gratitude to taxpayers. But there's no timeline or strategy for complete independence, and no mention of shareholder returns, which don't appear to be on the near-term horizon from management's perspective.

The stock, which was down about 6.3% year-to-date based on Friday's close, was looking strong ahead of the opening bell, quoted at $29.47, up 4.9%.

-- Written by Lauren Tara LaCapra in New York

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