>The recent bailout of iconic US financial institution American Insurance Group (AIG) by the US government is a clear sign of how bad things are in the global financial markets. However one Australian company, QBE insurance has weathered the storm far better than most and is now being bandied about as a potential buyer of the company. This would be a huge acquisition for QBE, given AIG’s global businesses ranging from life insurance to airplane leasing in 130 countries.
Two years ago, AIG by market capitalization and revenue was more than 10 times bigger than QBE. Now it is about one tenth in size based on market capitalization. How times have changed and for financially strong companies there are some amazing deals to be had. Should QBE close this highly unlikely deal, it will become one of the worlds largest insurers overnight. With a flagging share price and a high interest government loan (paying more than 11.4 percent interest on the $85 billion loan), AIG needs to raise cash as fast as possible – so perhaps this transaction is not as far fetched as it may seem.
No related posts.
Related posts brought to you by Yet Another Related Posts Plugin.
