American International Group Inc., the insurer that has rebuffed activist investor Carl Icahn’s push to divide into three companies, set a Jan. 26 presentation to outline Chief Executive Officer Peter Hancock’s vision.
The presentation will be a live webcast at 8 a.m. New York time, the company said Wednesday in a statement. The insurer also said it will report fourth-quarter results on Feb. 11.
AIG has promised to update investors with strategic plans and “accelerate its previously announced strategy” after Icahn said in November that he may propose the addition of a director who would agree to succeed Hancock if asked to do so by the board. Hancock has said it makes sense to keep both property- casualty and life insurance operations, but that he is prepared to sell some assets.
At the strategy session, AIG will provide a “proactive plan to drive shareholder value,” the insurer said in the statement.
The plan will need to go a fair way to convince investors, who have criticized Hancock’s actions in selling company units and laying off staff as not going far enough to make AIG profitable.
“CEO Peter Hancock described the sale as de-risking AIG’s PICC P&C position and improving its financial flexibility, but to us, this move looks more like a response to investor pressures than to internal risk management strategies,” Keefe, Bruyette & Woods Managing Director Meyer Shields said in a research note. He added that the sale “isn’t really a big deal either way” and “we view the current focus on selling or spinning pieces of AIG s much less valuable than the admittedly drastic decisions needed to repair its underperforming P&C business.”
To Icahn and other investors in the company, these drastic decisions include splitting the company into separate units and – if needed – ousting Hancock as president and CEO.
These efforts aim to break up AIG into three companies – property/casualty, life and mortgage insurance – and thereby up stockholder value.
Sonali Basak
Bloomberg News
