AIG’s New CEO has Investors Looking Up
On August 4th American International Group (AIG) announced they would be taking on former cheif executive of Metlife, Robert Benmosche, to become their new CEO. Since this news AIG’s stock has seen its stock more than double as shorts are covering and new long term investors are buying AIG stock.
AIG stock which reverse split on July 1st traded as low as $13.11 on August 4th (chart at bottom). Today AIG reached a fresh one month high of $35 even, a return of 167% for current shareholders and US taxpayers (who own 80% of the company).
Robert Benmosche, 65, has come out of retirement to take the helm at battered AIG with the primary goal being to pay back the US government and return AIG to profitability. Benmosche’s salary at AIG was approved at $7 million and he officially started working for AIG on Monday August 10th.
Today AIG stock surged over 30% in early morning trading after a report came out citing some upbeat comments from Benmosche regarding the future of AIG. From Reuters,
“At the end of the day, we believe we will be able to pay back the government and we hope we will be able to do something for our shareholders as well,” Benmosche said in an interview with Bloomberg while on holiday in Croatia.
“My first charge is to get the company to operate at the level it used to operate, being the world’s best,” he said, according to the report. “The fact is we owe the U.S. government a lot of money and we are not going to be able to pay it back just by our profits, so we will sell some of the company off but only at the right time at the right price.”
It is good to see some upbeat remarks coming from AIG especially the company has been for the most prat under the radar since the US government has stepped in to bail them out. Hopefully the moment can continue going in the right direction.
UPDATE: Last evening’s Tech Ticker has Barry Ritholtz on from The Big Picture. Looks like it will take AIG a whole century to pay back the US government.
Source:
New AIG CEO says expects to repay taxpayers: report
Rolfe Winkler
Reuters.com, Thu Aug 20, 2009 2:11pm EDT
