American International Group's AIG Financial Products Corp. unit, with offices in London, England and Wilton, Conn., said Friday that as part of winding down its operations it has sold off some business to an unnamed purchaser for $60.5 million.
AIGFP's involvement in credit default swaps on collateralized debt obligations caused its parent conglomerate to sustain billions in losses and Thursday the UK Serious Fraud Office said it was investigating the unit. AIG has disclosed that AIGFP's past reporting concerning its portfolio is being examined by U.S. authorities.
AIGFP said the sale it completed involved interests in two transactions and related commodity hedges from its energy and infrastructure book of business.
The two transactions, known as volumetric production payment (VPP) transactions, comprise limited-term overriding royalty interests entitling the VPP owner to a priority allocation of a fixed monthly production of oil and natural gas from designated producing reserves located in Texas, Louisiana and Mississippi.
The sale of these interests follows AIGFP's January agreement to sell its commodity index business.
"These successful asset dispositions provide further evidence of the progress we are making in reducing AIGFP's investment portfolio and overall risk profile," said Gerry Pasciucco, AIGFP Interim Chief Operating Officer. As previously disclosed, AIGFP began the process of unwinding certain of its businesses and portfolios late last year.
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