Hank Greenberg, prior CEO of AIG has developed a plan to take control of AIG, which was discussed on Charlie Rose program on Wed.
1. Greenberg has indicated that he had received approval from the NY Governor to upstream $20 Billion from the insurance subsidiaries to AIG Holdings.
2. He has been working with International Sovereign Wealth Funds, and indicates that he can raise an additional $30 Billion there.
3. He plans a rights offering for existing shareholders in the amount of $10 Billion.
4. And finally he proposes to sell off around $10 to $15 Billion in AIG assets.
He does not feel the full amount of the $85 billion credit line would be needed and so in reality they would need less than the $85 billion to take back control of the company.
This is going to happen, too many powerful investors and this is a profitable company, it is solvent and only needed a bridge loan, which is not a bail out as some call it.
Not gonna happen.
USA will make 100's of billions off it to help pay for this current crisis. Private Equity groups had 5 days to save the company and didn't. Once a deal is made you can't just change
It's ok to dream!
Given the scope of the current crisis you are the one who is dreaming. If you think Bernanke and Paulson aren't open to the best possible solution with the minimal impact to taxpayers, in particular now that there is such a backlash from politicians you may want to review your thesis. This is a costly bailout with no guarantees that government will make a penny out of it. At the chance of private investors taking over again, the government may be wise to back off.
you can't have a nationalization of the company. A loan is just that, a loan. Look at the SEC filings...The stock is up over 100% from the lows...With the Paulson bailout the liabilites for the company change significantly...who is dreaming now?
I've been saying this all along. I think AIG should walk from the original deal in light of Paulson's new deal. Then, Paulson buys AIG's impaired paper, its ratings go back to normal, and it can access credit market. AIG wouldn't need a loan at all, much less give away 4/5 of the equity. Stock would soar. Only questions are: (1) can AIG walk; and (2) can we be sure paulson's second plan would result in the purchase of substantially all of AIG's bad paper. Any thoughts?
The RTC type of plan will have a direct impact on AIG's future. The wisest thing will be to remain open (government) and flexible enough to rewrite last week's play. In fact, AIG may now have become more appealing to group of investors with a more certain future.
Thinking like an "American tax payer" ... even if the bailout plan allows AIG to restructure and not require the $85 billion ... I would demand the 80% equity and the profits gained by any rebound in coming days ... Washington will not allow Wall Street and stock holders to take all benefits from the tax payers' sacrifice! Be careful with your greed. This, most likely, is not going to do down like you are hoping and dreaming.