Felled insurance giant gets $30 billion more from government.
In a stunning reorganization of the 90-year-old global insurance conglomerate, American International Group will announce today that it is breaking into parts and handing over control of its two largest divisions to the U.S. government in exchange for $30 billion. This brings the government's ownership to nearly 80 percent in a holding company that, once its restructuring is complete, will have as its main task the selling off and listing of its own businesses. There was speculation about the breakup last week, but the announcement, will end any hope that the company might survive as a stand-alone entity. "Given the systemic risk AIG continues to pose and the fragility of markets today, the potential cost to the economy and the taxpayer of government inaction would be extremely high," a Treasury Department official said in a statement defending the plan.
