AIG shares prices prediction 2011

AIG shares prices prediction 2011 ; When it sells stock to the public later this year, insurance giant American International Group Inc. is planning to replace one or more of the four investment banks that managed its share offering in May, according to a published report.

AIG's re-IPO in May- which included an offer for sale of 100 million shares by AIG and 200 million shares by the U.S. Treasury- was priced at $29 per share, just above the government's break-even price of $28.73. Shares traded below $29 through most of June and closed on Friday at $29.94, implying a modest 3.6% gain for investors still holding on to the stock.

"The share sale was an utter debacle. This was tremendously, poorly done, badly placed and poorly priced," Scott Sweet of IPO Boutique told TheStreet in May reacting to the poor performance of shares following the offer. "The pricing of the secondary at $29 really had to work for future investors in order to take stock in future tranches. I have never heard clients so mad. They are furious at the underwriters, AIG and the government."

Analysts told TheStreet that Treasury will have a hard time selling its remaining 77% stake as investors still remain skeptical of AIG's prospects.

AIG's first quarter profit fell 85% to $269 million from a profit of $1.78 billion a year ago, as it took $1.7 billion in catastrophe-related losses on the Japanese earthquake and tsunami, earthquake in New Zealand and floods in Australia.

The insurer, however, set out some aggressive goals in the first quarter , outlining plans to raise $25 billion to $30 billion in deployable capital by 2015 and raise its pre-tax operating profit from $4 billion to $5 billion by 2015. It also said it may start share buybacks in 2012.

According to the Wall Street report, Benmosche said the banks handling the first sale did not fully understand AIG and had a hard time explaining the complexities of the business and the shares value to investors.

Benmosche told the newspaper that for the next offer, he wants bankers to show they have "a clear understanding of who AIG is, and our trajectory, and why AIG is a stock that investors should own."

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