AIG to sell Chile, Turkey units to Watsa

Bloomberg

American International Group Inc. agreed to sell commercial and consumer units in nations including Argentina and Turkey to Prem Watsa’s Fairfax Financial Holdings Ltd. for $240 million as Chief Executive Officer Peter Hancock narrows his company’s focus.
Fairfax will also acquire renewal rights on the portfolio of business written by AIG’s Central and Eastern European operations in countries including Poland, the New York-based insurer said Tuesday in a statement. Hancock is focusing on property-casualty coverage in nations such as the U.S. and Japan where his company enjoys large market share. He reached a deal in August to sell a mortgage guarantor to Arch Capital Group Ltd. and said this month that it was scaling back in Brazil after agreeing to transfer auto policies to a unit of Porto Seguro SA.
The deal with Toronto-based Fairfax “furthers AIG’s strategic goal of focusing its geographic footprint and investment in major economies that offer the greatest potential for profitable growth,” AIG said in the statement. “At the same time, AIG is committed to maintaining and enhancing multinational capabilities for individuals and companies that operate globally.”
Hancock previously announced transactions to exit operations in Panama, El Salvador and Guatemala. AIG has sold more than $90 billion of assets since 2009, mostly to repay a U.S. bailout. Watsa has been expanding through acquisitions to diversify risks and add premium revenue that he can invest in stocks or derivatives. He struck a deal last year to buy Brit Plc to grow in the Lloyd’s of London market. The AIG agreement also includes local units in Argentina, Colombia, Uruguay & Venezuela.
The businesses are “well
established in their respective markets with experienced management teams and a disciplined approach to underwriting, and they will significantly expand Fairfax’s footprint in Latin America,” complementing operations in Brazil, Watsa said in a separate statement.