AIG’s Plane Unit ILFC Pursues Sale of $3.5 Billion in Aircraft
March 2 (Bloomberg) -- American International Group Inc.’s plane-leasing business is pursuing the potential sale of aircraft for as much as $3.5 billion after the bailed-out insurer said it would support the unit.
International Lease Finance Corp. is evaluating bids that would probably result in a loss if a sale takes place, the Los Angeles-based plane unit said yesterday in a regulatory filing. Any transaction would have to be approved by the Federal Reserve Bank of New York, which holds jurisdiction over AIG since the U.S. provided a $182.3 billion bailout to the parent company.
“Proposed portfolios have been presented to potential buyers,” the unit said in the filing. “In evaluating the bids we are balancing the need for funds with the long-term value of holding aircraft and long-term prospects for us.”
New York-based AIG said in its annual report last week it “intends to provide support” to ILFC through Feb. 28, 2011, if needed. The unit is selling aircraft to raise funds after losing its usual financing sources, including commercial paper and unsecured debt, after rating downgrades at AIG.
Former CEO and founder Steve Udvar-Hazy resigned from the unit last month. Private-equity groups had backed Udvar-Hazy in an attempt to buy as much as a $4.5 billion chunk of ILFC’s fleet to start a firm, people with knowledge of the matter said in October.
source: businessweek.com
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