American International Group (AIG) has adopted Tax Asset Protection Plan designed to protect AIG's substantial tax assets.
This Plan is designed to reduce the likelihood that AIG will experience an ownership change by discouraging any person from becoming a 5% shareholder.
AIG said it may pursue other ways to protect AIG’s substantial tax assets.
As part of the Plan, the AIG board of directors declared a dividend of one preferred share purchase right for each outstanding share of AIG common stock, par value $2.50 per share.
The Rights will be distributable to shareholders of record as of 18 March 2011, as well as to holders of AIG common stock issued after that date.
AIG chairman Robert Miller said this Plan is designed to protect AIG’s valuable tax assets by reducing the likelihood of an unintended ‘ownership change’ through actions involving AIG’s securities.
"The Plan is particularly important as the US Department of the Treasury begins to reduce its position in AIG," Miller said.