The private-equity firm WL Ross & Co. has ended negotiations with American International Group Inc. to buy its mortgage insurance division, United Guaranty Corp., industry sources said.
Wilbur Ross, the firm's chairman and chief executive, issued a statement to National Mortgage News that said, "We never confirmed we were in the deal."
However, sources said WL Ross had been negotiating with AIG last year and was even in exclusive talks with the company for several months.
WL Ross wanted to purchase United Guaranty's licenses, operating systems and its entire 2009 book of business, leaving the "legacy" coverage — policies on loans written during the go-go years — with AIG. No price was ever mentioned.
Among mortgage insurers, United Guaranty ranks fifth nationwide in terms of policies-in-force with $127 billion. AIG has received pledges of up to $180 billion in taxpayer aid since its near collapse 16 months ago. The Treasury Department owns about 80% of the company, which is still publicly traded.