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AIG initiates plan to exit US govt's stake: Report

Under theplan, the US Treasury is likely to convert $49 billion of the company's preferred shares into common shares.

twitter-logo PTI   New York     Last Updated: September 14, 2010  | 16:08 IST

American International Group (AIG) is in talks with the United States government to speed up an exit plan designed to repay taxpayers in full, while enabling the giant insurer to regain independence, says a media report.

Under the plan, which could commence as early as the first half of 2011, the US Treasury is likely to convert $49 billion of AIG's preferred shares into common shares - a move that could bring the government's ownership stake in AIG to above 90 per cent from the current 79.8 per cent, The Wall Street Journal reported, citing people familiar with the plan.

However, the common shares would then be gradually sold off to private investors. This would reduce US ownership and potentially earn the government a profit if the shares rise in value, it added.

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