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AIG investors gather amid search for 5th chief since 2005
(China Daily)
Updated: 2009-07-01 08:08
 NEW YORK: American International Group Inc investors gathering for the insurer's annual meeting today are again waiting for a new chief executive officer to help return the company to profitability. AIG, which is selling assets to repay a $182.5 billion US bailout, hired executive search firm Spencer Stuart to find a replacement for outgoing CEO Edward Liddy, according to two people familiar with the situation. Liddy, 63, said last month that he wanted to leave the New York-based company as soon as a successor is appointed. A new leader "needs to show investors that there's something at the end of this and that they will survive", said Rose Grant, managing director at Boston-based Eastern Investment Advisors, which sold its AIG stock. "I can't imagine morale is the best right now." Liddy, who took over in September two days after the insurer's bailout, endured criticism about AIG bonuses and the costs of rescuing the firm. His successor will be the insurer's fifth CEO since 2005, when Maurice "Hank" Greenberg left the company after nearly four decades at the helm. Thomas Neff, US chairman of the recruiting firm, is involved in the search, said the people, who declined to be named because the process is not public. The firm was also used in finding AIG director candidates who are up for election today, said one of the people. Spencer Stuart declined to comment as did Christina Pretto, a spokeswoman for AIG. The new candidates for director are Harvey Golub, Laurette Koellner, Christopher Lynch, Arthur Martinez, Steve Miller and Douglas Steenland. Current board members Liddy, Dennis Dammerman, George Miles, Suzanne Nora Johnson and Morris Offit are up for reelection. Liddy has said he also plans to step down from the board and that the chairman and CEO posts should be split. At last year's shareholder meeting, then-Chairman Robert Willumstad reassured investors that Martin Sullivan was up to the task of running AIG. The next month, he replaced Sullivan amid calls to overhaul management. Willumstad lasted three months as CEO, until collateral calls from AIG's trading partners drained the company of liquidity, forcing the insurer to seek an $85 billion federal rescue. As part of the bailout, AIG's board agreed to install Liddy, the former CEO of auto insurer Allstate Corp. Liddy had to request more funds after initially saying the first rescue was "enough". The latest package, including an investment of as much as $70 billion, a $60 billion credit line and $52.5 billion to buy mortgage-backed assets owned or backed by the insurer, became necessary in March after declines on securities tied to real estate and corporate debt depleted capital. The insurer has plunged 95 percent in the past 12 months on the New York Stock Exchange. AIG said last week it would reduce its debt under the credit line by $25 billion by handing over stakes in two life insurance units that operate outside the US. The company, which agreed to turn over a majority stake to the US, has tapped about $40 billion from the line. The meeting, previously scheduled for May 13, was postponed as the trustees overseeing the US stake sought candidates for the board. Bloomberg News (China Daily 07/01/2009 page17) |
