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AIG Spin-Off to Raise TARP Money

|Includes: American International Group Inc (AIG)

AIG will be offering an IPO in Hong Kong to spin-off its lucrative Asian insurance branch, according to Sundeep Tucker and Francesco Guerrera, writing at ft.com (here).  The offering is expected to generate up to $20 billion, making it one of the world's largest IPOs and enabling AIG to start paying off its $80 billion TARP loan.  It is generally considered that AIG will have to continue selling parts of itself in order to continue making TARP repayments.  I have not seen an analysis that predicts which will come first:  running out of parts to sell or the repayment of the full $80 billion.

Disclosure: No positions in AIG.