US Treasury to Sell AIG Stock Worth $6bn

The US Treasury Department has said it will sell $6 billion worth of American International Group stock (AIG) and struck another deal for the insurer to pay down $8.5 billion more in obligations, taking a major step forward in an election year to unwind the unpopular crisis-era bailout.

AIG said the agreement with the government would allow it to pay down what it owed in a special purpose vehicle, AIA Aurora, and free up the company’s collateral against that, including interests in aircraft lesser International Lease Finance Corp and Asian insurer AIA Group.

The special purpose vehicle was set up in December 2009 in exchange for a reduction in the debt that AIG owed the New York Federal Reserve at the time.