AIG Board Authorizes Addl. $2 Bln Share Repurchase After ILFC Sale Closure

(RTTNews) - Insurer American International Group, Inc. (AIG) on Thursday announced that its board has authorized the repurchase of additional shares of AIG Common Stock of up to $2.0 billion, following the completion of the sale of International Lease Finance Corp. or ILFC.

"We are very pleased that the consummation of our sale of International Lease Finance Corporation and our strong capital position have allowed us to authorize this share repurchase, which enables us to return a portion of our sale proceeds directly to our shareholders," Chairman Robert Miller said in a statement.

AIG said it has repurchased about $418 million of shares of AIG since the end of the first quarter of fiscal 2014. Including the new authorization, AIG will now have a total share repurchase authorization of about $2.12 billion remaining.

The company noted that the share repurchases may be made from time to time in the open market, private purchases, through forward, derivative, accelerated repurchase or automatic repurchase transactions, or otherwise.

AIG completed on May 14 the sale of its aircraft leasing unit ILFC to Dutch aircraft lessor AerCap Holdings NV (AER) in a cash and stock deal valued at about $7.6 billion, based on AerCap's closing price of $47.01 on May 13. The consideration included $3.0 billion of cash and 97.56 million newly issued AerCap common shares.

The deal was valued at about $5.4 billion when it was agreed upon on December 16, based of the AerCap closing share price of $24.93 on December 13.

The AerCap common shares received by AIG represent an about 46 percent stake in the combined company that will retain the name AerCap, with ILFC becoming a wholly-owned subsidiary of AerCap. The existing AerCap shareholders will own the remaining about 54 percent stake.

AIG received net cash proceeds of about $2.4 billion on the closure of the deal after the settlement of intercompany loans.

Los-Angeles-based ILFC was the last major divestiture of non-core assets by AIG after selling more than $70 billion in non-core assets. ILFC was unable to attract a buyer as it has recorded big write-downs in recent years on the value of the older planes in its fleet.

AIG closed Thursday's regular trading session at $54.95, up $0.08 or 0.15% on a volume of 6.54 million shares, and AER closed at $48.00, up $0.68 or 1.44% on a volume of 1.01 million shares.