Hedge-fund operator Fortress Investment Group LLC has agreed to acquire 80% of American International Group Inc.'s American General Finance consumer-credit business as the beleaguered insurance company continues to shed noncore businesses.
Details of the deal were not disclosed.
American General Finance provides loans, retail financing and other credit-related products. It serves more than 2 million families in 45 states, the United Kingdom, Puerto Rico and the U.S. Virgin Islands. It has about $20 billion of assets and $18 billion of liabilities, including $17 billion of debt. They will be removed from AIG's balance sheet.
Fortress co-Chairman Wesley Edens said he believed "that AGF is well-positioned for significant growth in an underserved market." The deal is expected to close by the first quarter of 2011.
Last week, AIG Chief Executive Robert Benmosche said the insurer is currently focused on repaying its debt to the New York Federal Reserve Bank, which was recently owed around $23.6 billion.