Could Kanak Succeed AIG's Greenberg?

By Michael Ha

NU Online News Service, Dec. 5, 12:05 p.m. EST?American International Group Inc. said it has named Donald Kanak as new vice chairman and co-chief operating officer, boosting Mr. Kanak's chance of eventually succeeding longtime chairman Maurice Greenberg.[@@]

Mr. Kanak replaces Edmund Tse, 65, in the co-chief operating officer role. Mr. Tse will now focus on the company's life businesses in Asia and around the world.

Mr. Kanak, 50, first joined New York-based AIG in January 1992 and has recently been serving as president and chief executive officer of AIG Companies in Japan and Korea.

For his new role, which takes effect beginning next month, he will move to New York to work alongside Martin Sullivan, 49, who is the other vice chairman and co-chief operating officer. The two men will then be the top two executives right behind Mr. Greenberg.

"I think, right now, you have to look at Don Kanak and Martin Sullivan?either of them or even together?as a likely successor to Mr. Greenberg," Mark Lane, research analyst at Chicago-based financial firm William Blair & Co., told National Underwriter. "Donald Kanak has been seen as someone who has been rising within the organization. But this clearly symbolizes that sort of recognition."

Stephanie Eakins, financial analyst at Jupiter, Fla.-based Weiss Ratings Inc., also agreed with that assessment and said, "Mr. Kanak is one of the top candidates for succeeding Mr. Greenberg, since Mr. Greenberg's sons are no longer working at AIG. They have left in the last few years?they have gone to other insurance companies."

Mr. Lane noted that the important thing about AIG and succession is that "it's got to be someone within the company, and those two guys are now the second group in command. It's a natural place to look for a successor."

Still, Mr. Lane acknowledged that it remains difficult to predict who will eventually replace Mr. Greenberg, and even when Mr. Greenberg will decide to retire.

"Trying to predict when Hank Greenberg will want to step aside has been very challenging," he said. "He is still very involved in day-to-day operations, so it's very difficult to predict. There is a succession plan right now, but it just hasn't been made public. If something were to happen to Mr. Greenberg, there is a plan in place."

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Could Kanak Succeed AIG's Greenberg?

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