NU Online News Service, March 6, 2:17 p.m. EST

American International Group says it completed the sale of 14 percent of the stock of its Hong Kong life insurer, AIA Group, Ltd., at the projected price of approximately $6 billion.

AIG says the transaction will close Thursday, and that it received a price of HK$27.15, or $3.50, each for the shares.

The sale leaves AIG holding 18.6 percent of the stock of AIA, regarded as one of its trophy holdings before it got into financial trouble in 2008 and sought a government bailout.

In its release, AIG says that it is restricted from selling the remaining 19 percent of AIA that it still owns until Sept. 4.

AIG says it sold 1.72 billion shares—slightly more than the planned 1.7 billion—at the bottom of its indicative price range. That price represents a 7 percent discount to Friday's closing price on the Hong Kong market.

The shares are held in a special facility for the benefit of the U.S. government, which will get the proceeds from the sale.

The facility is a special purpose vehicle created by AIG and the U.S. Treasury to hold the AIA shares in return for cash from the government.

The original special vehicle involving AIA totaled $25 billion, and included ALICO, since sold to MetLife. The AIA share was $16 billion; the ALICO share $9 billion.

The ALICO portion was paid off as part of the effort to close the Federal Reserve Board's loans to AIG.

Special Reports /

AIG Completes Sale of 14% of AIA

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