News 7

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News 7

  1. 1. AIG Asian unit IPO expected to raise $14.1bn<br />
  2. 2. HONG KONG: The upcoming Hong Kong listing of American International Group <br />Inc.'s Asian unit is expected to raise $14.1 billion for AIG's repayment of bailout <br />funds from the U.S. government during the global financial crisis, the Asian insurer <br />said on Sunday. AIA Group Ltd. said in a prospectus it plans to sell 586 million shares in Hong Kong <br />and 5.27 billion shares internationally at a price range of HK$18.38 (US$2.40) to <br />HK$19.68 ($2.50) per share. The estimated proceeds from the share sale are <br />based on the midpoint price of HK$19.03 ($2.45) per share and deducts projected <br />underwriting fees and other expenses. <br />
  3. 3. Some $190 billion has not been repaid from the massive Wall Street bailouts <br />launched during President George W. Bush's final months in office. AIG, which <br />suffered from investments in complex derivatives instead of its traditional <br />businesses, received $182 billion _ the biggest rescue package extended to the <br />financial industry. Officials believed its survival was crucial because AIG worked <br />with hundreds of financial institutions around the world. The $14.1 billion will be used to repay an initial pool of $20 billion AIG received <br />from the Federal Reserve Bank of New York, AIA said. AIG is also repaying other <br />sums it owes the U.S. government by letting the U.S. Treasury exchange its <br />majority stake in the company for common stock and sell those shares over time. <br />
  4. 4. AIA says institutional investors have pledged to buy $1.92 billion in shares. Major <br />investors include the Kuwait Investment Authority ($1 billion), the Malaysian <br />government employee pension fund Kumpulan Wang Persaraan ($200 million) <br />and Malaysia's Hong Leong Financial Group Berhad, which is investing $370 <br />million and $50 million through two units. Hong Kong tycoons Cheng Yu-tung and Peter Woo have also signed on. Cheng is <br />buying $388 million in shares through an investment holding company and the <br />same amount through his company NWS Financial Management Services Ltd. Woo <br />pledged $200 million through Lorita Investments Ltd. <br />
  5. 5. Retail investors in Hong Kong can start applying for shares Monday and trading <br />will start Oct. 29. AIA, which operates in 15 Asian territories, said it recorded an interim operating <br />profit of $1.134 billion this fiscal year and is expected to post a full-year operating <br />profit of no less than $2 billion. It reported an operating profit of $1.781 billion <br />last year. The insurer said it plans to expand by targeting India and China, where it's the <br />largest foreign life insurer by premiums, and moving into Islamic finance in <br />Malaysia and Indonesia. <br />
  6. 6. Delhi CWG 'denigrated' India's image: Aiyar<br />
  7. 7. NEW YORK: Continuing his tirade against the just-concluded Commonwealth Games , <br />former sports minister Mani Shankar Aiyar said India should have focused on improving <br />the plight of its poor instead of spending thousands of crores on the event which only <br />"denigrated" its image. "Tell me if your stadium is empty why not invite the children of those labourers who <br />built the stadium to come in and sit down," Aiyar, the most vocal critic of the Delhi <br />Commonwealth Games, said. "But no, this was a middle class party." <br />"So only PLUs (people like us) were given the opportunity of coming in and they <br />didn't come in adequate numbers," the Congress MP said, noting that 960 <br />croresspent on renovating the Jawaharlal Nehru Stadium could have been put <br />to better use. <br />
  8. 8. Aiyar also claimed that no single event had done more damage to India's image <br />in the past 63 years since independence than the recent Commonwealth <br />Games. "I don't think the world has ever denigrated us and in such obscene language as <br />we have seen happening in the past few weeks," he said. "70,000 crores to get ourselves a bad name," the former minister said, referring <br />to the total amount spent on the 12-day mega sporting event. On whether the Games were a success as declared by the Indian government , <br />Aiyar claimed that the event had failed to position India as a top player on the<br />
  9. 9. global stage. "I'm not sure we've attained the objective we had of projecting ourselves as a great <br />rising economic power to the Western world or even to Africa," he said. <br />

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