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Geithner: Failure of AIA Sale Not A Setback

Source: Dow Jones

Posted on 04 Jun 2010

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U.S. Treasury Secretary Timothy Geithner said this week that the breakdown of the deal for American International Group Inc. (AIG) to sell its Asian life insurance unit to Prudential PLC wasn't a setback in the government's effort to recoup taxpayer money.

"AIG is now free to pursue a bunch of other options to help maximize the return" for taxpayers, Geithner told reporters at a briefing.

Earlier Wednesday, Prudential backed out of its $35.5 billion offer to acquire AIG's AIA Group after failing to renegotiate a lower price for the deal.

AIG had planned to use proceeds of the deal to start repaying the U.S. taxpayers who had bailed it out to the tune of $132 billion.

Geithner praised AIG's management team and board for making "impressive" progress on the restructuring.