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AIG - American International Group


PlanMaestro

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I believe he's made that argument before. How much leeway does management actually have to intentionally depress earnings like that?  It seems that any "conspiracy" to depress earnings that was big enough to matter would get leaked, and AIG would get skewered for it. 

 

However, I hope he's right!

 

In an insurance company, I think they have a lot of discretion when it comes to reserving. So I don't know if it took place, but it certainly seems possible.

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AIG Enters Deal to Extend Airplane-Unit Sale Deadline to June 14

 

American International Group Inc. reached an agreement with a consortium of Chinese investors to extend by one month the deadline to complete a sale of AIG’s plane-leasing unit.

AIG or the acquirers may terminate the deal for International Lease Finance Corp. if it hasn’t closed by June 14, the New York-based insurer said today in a regulatory filing.

 

http://www.bloomberg.com/news/2013-05-13/aig-enters-deal-to-extend-airplane-unit-sale-deadline-to-june-14.html

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AIG Enters Deal to Extend Airplane-Unit Sale Deadline to June 14

 

American International Group Inc. reached an agreement with a consortium of Chinese investors to extend by one month the deadline to complete a sale of AIG’s plane-leasing unit.

AIG or the acquirers may terminate the deal for International Lease Finance Corp. if it hasn’t closed by June 14, the New York-based insurer said today in a regulatory filing.

 

http://www.bloomberg.com/news/2013-05-13/aig-enters-deal-to-extend-airplane-unit-sale-deadline-to-june-14.html

 

I always had reservations about this deal going through. If I had to make a 50/50 call, I will put money on it not going through. Reason being that roughly half this company's fleet consists of Boeing aircraft and the way most buyers get financing is thanks to a fairly complicated guarantee arrangement from the EXIM Bank (US); EXIM is sometimes referred to as Boeing's bank. So if you look through all the jargon you have a situation where the US gov/tax payer subsidizes virtually every Boeing sale, which might be harder to swallow when you are selling to a Chinese co rather than AIG. Add to that the political angle it introduces into whether the sale goes through or not and it just make it too much of a stretch for me.

 

So as much as I would like this to happen, my money says this deal does not go through. I hope I'm proven wrong.

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I am a bit lazy to search but what is the break fee on this deal if the Chinese walk away?

 

S

 

AIG Enters Deal to Extend Airplane-Unit Sale Deadline to June 14

 

American International Group Inc. reached an agreement with a consortium of Chinese investors to extend by one month the deadline to complete a sale of AIG’s plane-leasing unit.

AIG or the acquirers may terminate the deal for International Lease Finance Corp. if it hasn’t closed by June 14, the New York-based insurer said today in a regulatory filing.

 

http://www.bloomberg.com/news/2013-05-13/aig-enters-deal-to-extend-airplane-unit-sale-deadline-to-june-14.html

 

I always had reservations about this deal going through. If I had to make a 50/50 call, I will put money on it not going through. Reason being that roughly half this company's fleet consists of Boeing aircraft and the way most buyers get financing is thanks to a fairly complicated guarantee arrangement from the EXIM Bank (US); EXIM is sometimes referred to as Boeing's bank. So if you look through all the jargon you have a situation where the US gov/tax payer subsidizes virtually every Boeing sale, which might be harder to swallow when you are selling to a Chinese co rather than AIG. Add to that the political angle it introduces into whether the sale goes through or not and it just make it too much of a stretch for me.

 

So as much as I would like this to happen, my money says this deal does not go through. I hope I'm proven wrong.

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Klarman / Baupost shows some convictions:

 

http://seekingalpha.com/article/1435821-tracking-seth-klarman-s-baupost-group-holdings-q1-2013-update?source=yahoo

 

American International Group (AIG): AIG is a large 15.11% position established last quarter at prices between $30.68 and $37.21. The position size was increased by close to 80% this quarter at prices between $35 and $40. The stock currently trades well outside that range at around $46. The substantial stake increase indicates a clear bullish bias.

 

The 15.11% value is probably just in terms of their equity portfolio.

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Klarman / Baupost shows some convictions:

 

http://seekingalpha.com/article/1435821-tracking-seth-klarman-s-baupost-group-holdings-q1-2013-update?source=yahoo

 

American International Group (AIG): AIG is a large 15.11% position established last quarter at prices between $30.68 and $37.21. The position size was increased by close to 80% this quarter at prices between $35 and $40. The stock currently trades well outside that range at around $46. The substantial stake increase indicates a clear bullish bias.

 

The 15.11% value is probably just in terms of their equity portfolio.

 

Yes and I think they have something like $3bn in equities in what I last read was $18bn in AUM, so on a total portfolio basis it's not huge.

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FYI, I believe this week's valueline is the first one since the melt-down that actually puts AIG back on ranking, with targets and estimates.  Seems like an indication of turn in sentiment.  Also, they have BVPS being at 90 in the 2016-2018 range, which is still well before the warrants expiry date...

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  • 2 weeks later...
Insurer American International Group Inc said on Friday it had not received a scheduled deposit payment related to its sale of airplane leasing company ILFC to a Chinese consortium.

 

Under terms of the purchase agreement between the two sides, the missed deposit payment gives AIG the right to cancel the sale.

 

http://www.reuters.com/article/2013/05/31/aig-ilfc-idUSL2N0EC0H620130531?feedType=RSS&feedName=marketsNews&rpc=43

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American International Group's stock had its “buy” rating reiterated by stock analysts at Sanford C. Bernstein in a report issued on Monday, Analyst Ratings Network.com reports. They currently have a $60.00 price objective on the stock. Sanford C. Bernstein’s price objective would indicate a potential upside of 34.08% from the company’s current price.

 

http://bit.ly/133XtV5

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http://www.bloomberg.com/news/2013-06-04/aig-chief-raises-doubt-about-completing-plane-unit-sale.html

 

 

AIG Chief Raises Doubt About Completing Plane-Unit Sale

 

 

 

 

American International Group Inc. (AIG) Chief Executive Officer Robert Benmosche raised doubt about whether the company will complete a sale of its plane-leasing unit to a Chinese investor group by a deadline this month.

 

“June 14, we have to make a decision,” he said yesterday at a conference in New York, where the insurer is based. “Whether this deal will get done or not, we don’t know.”

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AIG Tells Judge BofA Settlement Is 'Inadequate'

 

http://online.wsj.com/article/SB10001424127887324063304578525462352644782.html?mod=WSJ_hp_LEFTWhatsNewsCollection

 

 

American International Group Inc. AIG -1.45% argued at a New York court hearing Tuesday that an $8.5 billion settlement between Bank of America Corp. BAC -1.40% and investors over mortgage-backed-securities losses is "inadequate" and the result of a conflicted process.

 

In the second day of a hearing in New York State Supreme Court, Judge Barbara Kapnick heard opening arguments from the lawyer for AIG, the largest investor objecting to the 2011 pact to settle claims over debt securities issued by Countrywide Financial Corp.

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