Monday, December 22, 2008

AIG Fire Sales Hartford

AIG (AIG) sold its Hartford Steam Boiler unit to Germany's Munich Re for $742 million, a steep discount from what AIG paid for HSB in 2000. AIG is under intense pressure to sell off assets to repay government loans and backstops. But if government loans total over $100 billion and prime assets such as Hartford are going for deep discounts are there the assets to effect a recovery? At this rate they will need to sell off the financial equivalent of 135 Hartford styled/sized deals.