Packer16 Posted December 10, 2012 Share Posted December 10, 2012 The discount to BV for the ILFC is similar to what AYR and FLY are trading at today. Packer Link to comment Share on other sites More sharing options...
jrallen81 Posted December 10, 2012 Share Posted December 10, 2012 That sale price is below the equity value of ILFC; .7x book, so on the low end but probably not far off consensus expectations for what it could be sold for at present. Was hoping for 1x book. Yet it reinvigorates the buyback thesis for 2013. Will be interesting to see the market reaction - I would think it will sell off on the price, but likely will be viewed more sanguinely later: simplifies the story, buybacks continuing, etc. Link to comment Share on other sites More sharing options...
biaggio Posted December 10, 2012 Share Posted December 10, 2012 does the sale not also get rid of a lot of debt- ILFC was very leveraged if I remember correctly Link to comment Share on other sites More sharing options...
vinod1 Posted December 10, 2012 Share Posted December 10, 2012 Even though ILFC's $24 billion debt is not guaranteed by AIG I think this would be a positive for AIG's credit rating. Since the completion of the deal is set for Q2 2013 any buy backs would have to wait until then. Vinod Link to comment Share on other sites More sharing options...
finetrader Posted December 10, 2012 Share Posted December 10, 2012 You gotta like this deal because it simpify the company and liberate manager's mind from this item and gets them to concentrate on operational issue. It's still a long way to ROE=10. Link to comment Share on other sites More sharing options...
MYDemaray Posted December 10, 2012 Share Posted December 10, 2012 Also...in terms of time value, this is a better deal than an IPO b/c I doubt they could have floated 80-90% of the firm in an IPO. This gets them more cash, quickly. Now lets see if they can use that for buybacks under Fed supervision. Link to comment Share on other sites More sharing options...
CONeal Posted December 10, 2012 Share Posted December 10, 2012 Not real excited about the deal. Since it isn't expected to close in the 2nd qtr wondering how this will will be treated under the stress test. Link to comment Share on other sites More sharing options...
gokou3 Posted December 10, 2012 Share Posted December 10, 2012 Not too happy about the ILFC valuation, but otoh they still sold it for a greater P/B than its own shares. This would be a net positive if they can throw all of their proceeds at buybacks quickly. Link to comment Share on other sites More sharing options...
MrB Posted December 10, 2012 Share Posted December 10, 2012 Wonder what the odds are the deal gets blocked. Airlines used to be strategic industries and the US government is heavily involved in the financing side EXIM/Boeing. So not sure it will be plain sailing. Link to comment Share on other sites More sharing options...
FrankArabia Posted December 10, 2012 Share Posted December 10, 2012 don't like the deal but it must be done....... Link to comment Share on other sites More sharing options...
vpagano Posted December 10, 2012 Share Posted December 10, 2012 http://www.marketwatch.com/story/treasury-plans-to-sell-remaining-shares-of-aig-2012-12-10?siteid=yhoof2 http://www.treasury.gov/press-center/press-releases/Pages/tg1794.aspx The Treasury is selling the rest of its AIG stake, the price will be $32.50 I saw posted elsewhere :) Link to comment Share on other sites More sharing options...
valueinvesting101 Posted December 10, 2012 Share Posted December 10, 2012 Which warrant does government own? Any details about them? Link to comment Share on other sites More sharing options...
fareastwarriors Posted December 10, 2012 Share Posted December 10, 2012 http://www.marketwatch.com/story/treasury-plans-to-sell-remaining-shares-of-aig-2012-12-10?siteid=yhoof2 http://www.treasury.gov/press-center/press-releases/Pages/tg1794.aspx The Treasury is selling the rest of its AIG stake, the price will be $32.50 I saw posted elsewhere :) Thanks for posting. Hopefully AIG sells off a bit on that news so I can buy more at a lower price. Link to comment Share on other sites More sharing options...
Uccmal Posted December 10, 2012 Share Posted December 10, 2012 I bought some more 2015s x 40 today bringing my holdings notional, warrant, and common to 30000 shares. That was before the news. Obviously people knew this was coming today. Link to comment Share on other sites More sharing options...
ShahKhezri Posted December 10, 2012 Share Posted December 10, 2012 AIA lockup is today as well. We'll soon hear how much of the $6bn holding they sell. As of last month I thought BAC was about 6-9 months ahead of AIG, with the recent activity I'd say they've caught up fast. I just thought the new testing they were going through would paint the gov holding/non-core assets with a bad brush and keep them from repurchases/dividend. With ILFC, gov holding to zero and AIA (potentially)...they are doing well. Link to comment Share on other sites More sharing options...
Myth465 Posted December 10, 2012 Share Posted December 10, 2012 I bought some more 2015s x 40 today bringing my holdings notional, warrant, and common to 30000 shares. That was before the news. Obviously people knew this was coming today. What do you think is the best value UCC. I only own the common thus far. Link to comment Share on other sites More sharing options...
zippy1 Posted December 10, 2012 Share Posted December 10, 2012 I bought some more 2015s x 40 today bringing my holdings notional, warrant, and common to 30000 shares. That was before the news. Obviously people knew this was coming today. What do you think is the best value UCC. I only own the common thus far. Myth, please call him "Al." I think "UCCMAL" means "you can call me Al." Link to comment Share on other sites More sharing options...
mankap Posted December 10, 2012 Share Posted December 10, 2012 I am assuming that AIG cannot buy back any shares being sold now.I do not know why Fed should stop them from buying back. Link to comment Share on other sites More sharing options...
Uccmal Posted December 10, 2012 Share Posted December 10, 2012 I bought some more 2015s x 40 today bringing my holdings notional, warrant, and common to 30000 shares. That was before the news. Obviously people knew this was coming today. What do you think is the best value UCC. I only own the common thus far. Myth, please call him "Al." I think "UCCMAL" means "you can call me Al." lol, Anyway, Myth, I have no idea. I Try to use Leaps where I think there is a high potential for a big run up in less than the two year time frame, for the leverage. But I dont like leaving everything in levered instuments. Link to comment Share on other sites More sharing options...
Myth465 Posted December 11, 2012 Share Posted December 11, 2012 LOL I never picked up on that. Yes I have learned my lessons on LEAPs. I will require a catalyst to buy in the future. I have held most of my position of SD in Leaps and now is the right time to buy them vs the last 2 years. I have an AIG common position and will continue looking at the warrants. They are making all the right moves and will creep towards book value as the story continues to get simpler. Link to comment Share on other sites More sharing options...
CONeal Posted December 11, 2012 Share Posted December 11, 2012 I am assuming that AIG cannot buy back any shares being sold now.I do not know why Fed should stop them from buying back. Ran across an article where someone from AIG stated that they will not participate in this buyback. Link to comment Share on other sites More sharing options...
jeffmori7 Posted December 11, 2012 Share Posted December 11, 2012 As I cannot afford the remaining government stake and AIG won't buyback, I would have like Berkshire to buy it in a private deal. But it will be a public offering finally. I'm surprised Buffett never spoke about AIG as he knows insurance pretty well and it is a big elephant. Is he legally restrained to buy other insurance companies? Link to comment Share on other sites More sharing options...
Liberty Posted December 11, 2012 Share Posted December 11, 2012 I am assuming that AIG cannot buy back any shares being sold now.I do not know why Fed should stop them from buying back. Ran across an article where someone from AIG stated that they will not participate in this buyback. It's mentioned on Bloomberg: "Before today, the U.S. had sold $44 billion of AIG shares in five offerings, and the insurer bought back $13 billion in the sales. AIG will not buy shares in the latest offering, said Jim Ankner, a spokesman for the company. The New York Fed in August finished selling securities that it acquired in AIG’s rescue." http://www.bloomberg.com/news/2012-12-10/aig-bailout-that-angered-bernanke-to-end-with-treasury-sale-1-.html Link to comment Share on other sites More sharing options...
Liberty Posted December 11, 2012 Share Posted December 11, 2012 As I cannot afford the remaining government stake and AIG won't buyback, I would have like Berkshire to buy it in a private deal. But it will be a public offering finally. I'm surprised Buffett never spoke about AIG as he knows insurance pretty well and it is a big elephant. Is he legally restrained to buy other insurance companies? I could be wrong, but my feeling is that Buffett doesn't invest in insurance companies if he can't control how the float is invested. So he buys them whole, or not at all, and AIG's not an elephant, it's a blue whale. Link to comment Share on other sites More sharing options...
jeffmori7 Posted December 11, 2012 Share Posted December 11, 2012 As I cannot afford the remaining government stake and AIG won't buyback, I would have like Berkshire to buy it in a private deal. But it will be a public offering finally. I'm surprised Buffett never spoke about AIG as he knows insurance pretty well and it is a big elephant. Is he legally restrained to buy other insurance companies? I could be wrong, but my feeling is that Buffett doesn't invest in insurance companies if he can't control how the float is invested. So he buys them whole, or not at all, and AIG's not an elephant, it's a blue whale. It makes sense. Good one on the blue whale! Link to comment Share on other sites More sharing options...
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