AIG to shed stake in financial products joint ventures
NEW YORK (Reuters) - American International Group, Inc (AIG.N) said its financial products unit would sell a 50 percent stake in three joint ventures back to partner Tenaska Energy.
The transaction is set to close on Jan. 2, AIG said in a statement on Wednesday. The insurer said it would not disclose terms for the sale of its share of Tenaska Marketing Ventures, Tenaska Gas Storage and Tenaska Marketing Canada.
AIG is selling the stake as it winds down its financial products division.
The division made big bets by guaranteeing U.S. residential mortgage assets with credit default swaps. Large losses from those assets left the company with $42.5 billion in losses over the past year.
AIG was bailed out by the U.S. government in September after these soured investments left it close to bankruptcy. It is in the process of selling off assets to repay the government.
AIG Financial Products bought the stake in the Tenaska affiliates last year.
Tenaska, a privately held energy company based in Omaha, Nebraska, will seek a new partner for these businesses early next year, Chief Financial Officer Jerry Crouse said.
An advisory unit of Blackstone Group (BX.N) advised AIG on the sale.
(Reporting by Lilla Zuill; Editing by Lisa Von Ahn)
