American International Group Inc. (AIG) will not sell off its Chartis property and casualty unit, because CEO Robert Benmosche says it is a core asset and he’d much rather try to build up the company than sell chunks of it to investors, Reuters reports, citing a person familiar with the situation.
According to the source, who has requested anonymity because the discussions about Chartis are not public, the move is consistent with Mr. Benmosche’s plan to rebuild AIG, as Chartis is seen as core holding to the insurer.
AIG, which the U.S. government had to prop up with $180 billion in taxpayer funds, had earlier planned to sell a stake of up to 20 percent in Chartis through either an initial public offering or transactions with private investors.
The company renamed the unit as Chartis in July.
But a Chartis initial public offering was still some time away. That IPO was seen as third in line, after AIG’s American International Assurance and American Life Insurance Co life insurance units, the source said.
AIG in April had said it was preparing for the IPO of a minority stake in Chartis, formerly known as AIU Holdings.
This isn’t the first time Mr. Benmosche has halted an auction since he joined AIG in August. He also shelved the planned sale of two Japanese life insurers and a U.S. investment advisory unit.