American International Group Inc. (NYSE:AIG) said it filed an ASR (automatic shelf registration) S-3 statement with the U.S. Securities and Exchange Commission on Friday, allowing the giant insurer to sell preferred and common stock in the future.
The filing had no dollar amount set, nor did it list any financial terms. But according to the filed prospectus, the filing, besides fully conforming with current market practices that facilitate AIG with maximum flexibility to respond to financing opportunities, also allows it for one or more series of preferred stock to be “convertible into or exercisable or exchangeable for common stock or another series of preferred stock.” AIG, states the prospectus, may also offer and sell common stock or preferred stock depending on market fluctuations.
In the description of common stock it may offer, AIG’s filing reads that the insurer ’s “authorized capital stock includes 5,000,000,000 shares of common stock (par value $2.50 per share). As of June 30, 2009, after giving effect to a reverse stock split at a ratio of one-for-twenty, there were 134,569,378 shares of common stock outstanding.” The use of proceeds was listed as the standard “for general corporate purposes,” and that the shares “may from time to time be issued at indeterminate prices.”
Purchasers of shares of common stock will not receive stock certificates as evidence of their share ownership. Instead, they will be provided with a statement reflecting the number of shares registered in their accounts, the company said in its filing. Whether AIG will be able to attract any interest in selling any securities, it remains to be seen. Chances are however, it might not sell any at all.
To say AIG continues to struggle financially, it would be an understatement. So far the company has managed to sell off $5.7 billion in assets in order to pay back the $180 billion it owes the federal government. The insurer has also been able to somewhat diminish its CDS exposure to $1.5 trillion from $2.7 trillion.