AIG has announced that the underwriters have exercised option to buy up to an additional 3.9 million shares of Transatlantic Holdings (TRH) common stock from AIG and its subsidiary, American Home Assurance Company (AHAC).

Thus, AIG and AHAC will sell 29.9 million shares for total gross proceeds of $1.13 billion.

TRH will not receive any of the proceeds from the secondary offering.

The divestiture of shares is related to AIG’s previous announcement regarding the public offering of 26 million shares of TRH common stock in an underwritten offering. These shares are owned by AIG and its subsidiaries.

Post completion of the secondary offering, AIG and AHAC will end up with 9,192,662 common shares of TRH, representing about 13.9 % of TRH’s common shares issued and outstanding.

The secondary offering was exercised through a syndicate of underwriters, headed by Morgan Stanley, J.P. Morgan, and Goldman, Sachs as joint book-running managers. Fox-Pitt Kelton Cochran Caronia Waller and Dowling & Partners served as co-managers of the offering. Lazard Capital Markets acted as co-lead underwriter.