American International Group Inc. is in talks with MetLife Inc. to sell one of it's largest insurance units for between $14 billion and $15 billion, according to news reports Tuesday citing people familiar with the matter.
The two companies have been in discussions for months about a potential deal for AIG's American Life Insurance Co., known as Alico, the Wall Street Journal reported. The New York Times' DealBook blog also had a similar report.
Alico is an international life and health insurance business that operates in more than 50 countries around the world.
AIG spokesman Mark Herr said it is the company's policy not to comment "on rumors and speculation."
MetLife spokesman Chris Breslin would not comment directly on the reports, but said in an e-mail: "MetLife does not need to enter into any M&A transaction to meet its business objectives."
AIG was bailed out by the government in September 2008 at the peak of the credit crisis. As losses continued to pile up, the government eventually extended AIG an aid package worth more than $180 billion and took a stake of nearly 80 percent in the company.
The sale of Alico would be the biggest step to date by AIG to pay back public bailout funds. AIG has previously indicated that about $9 billion of proceeds would go back to the government.
Late last year, AIG moved Alico and its American International Assurance Co. unit into special purpose vehicles, which are used ahead of a move to separate a unit from a parent company. The purpose of the move was to reduce the amount of debt AIG owes the Federal Reserve Bank of New York.
Under that agreement, the New York Fed agreed to swap about $25 billion of its loans to AIG in exchange for a stake in the two insurers.
AIG's CEO Robert H. Benmosche, a former head of MetLife, has said AIG would not resort to a fire sale of its businesses.
Shares of AIG rose 18 cents to $28.24 in afternoon trading Tuesday, while shares of MetLife rose $1.01, or 2.7 percent, to $38.86.
© Copyright 2022 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.