photo = AP
American insurance company AIG has submitted an initial public offering (IPO) application for listing of its retirement asset divisions, including life insurance and pensions. Foreign media reported that the company’s value surpassed $20 billion and is the largest among companies that have gone public this year.
According to Bloomberg News on the 28th (local time), AIG submitted IPO documents for SAFG Return Service, which is in charge of life insurance and retirement asset management businesses. After the company goes public, the company plans to change its name to Corebridge Financial. “This is a major step forward for the separation of the life insurance and retirement asset management divisions into independent companies,” AIG Chairman Peter Zafino said in a statement on the same day.
According to documents submitted for IPO, SAFG posted sales of $23.39 billion last year, up 55% from the previous year. After-tax operating profit rose 14.5 percent to $2.93 billion during the same period. The valuation amount of the newly listed company was not disclosed. The Financial Times (FT) and others predicted that the company’s enterprise value, with $411 billion of assets under management, would exceed $20 billion. The estimate is based on the fact that Blackstone purchased a 9.9% stake in SAFG for $2.2 billion in November last year.
New listings on the U.S. stock market this year have significantly decreased. The market volatility is growing as interest rates rise and the Ukraine war go hand in hand. Only 33 companies have gone public since January of this year. They also raised only $2.75 billion in the market. In the first quarter of last year, 150 U.S. companies went public, raising more than $56 billion. SAFG is the largest company that has applied for an IPO for listing on the US stock market this year.
The listing will put an end to AIG’s years of restructuring, Bloomberg said. AIG sold its aircraft rental business and consumer finance business after the 2008 financial crisis. In 2015 and 2017, activist investors, including Carl Icahn, demanded that the general and life insurance divisions be separated, but AIG management did not give up. The AIG policy has changed since 2020. As profitability deteriorated at the time, management announced that it would spin off the life insurance business.
Along with the news of the IPO filing, AIG announced that it would entrust BlackRock with asset management worth $150 billion. According to the FT, insurance companies and pension funds are cutting costs by outsourcing fund management to external asset management companies.
Reporter Lee Ji-hyun bluesky@hankyung.com
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