American International Group remains on track to sell of part of its Life & Retirement unit through an IPO in the first half of 2022, according to company President and CEO Peter Zaffino. Some mystery remains, however, as to when the insurer will unload the rest.

“We continue to expect an IPO to occur in the first quarter of 2022, or potentially in the second quarter, subject to regulatory approvals and market conditions, Zaffino said during AIG’s Q3 2021 earnings call on Nov. 5.

Peter Zaffino/AIG

He reminded analysts and investors that there are caveats about the long-term process of making AIG’s Life & Retirement arm a fully independent company.

“As I mentioned on our last call, due to the sale of our affordable housing portfolio and the execution of certain tax strategies, we are no longer constrained in terms of how much [of] Life & Retirement we can sell in an IPO,” Zaffino explained.

With that in mind, AIG will still keep a majority stake in the unit, at least at first.

“We currently expect to retain a greater than 50 percent interest immediately following the IPO, and to continue to consolidate Life & Retirement’s financial statements until such time as we fall below the 50 percent threshold,” Zaffino said.

Progress Made

AIG has made progress in separating part of its Life & Retirement unit since it first announced plans to do so in July.

The insurer, for example, recently closed plans to sell a 9.9 percent stake in the business to Blackstone for $2.2 billion. It also announced a number of leadership changes that it said will help support the Life & Retirement separation process and also implement other strategic priorities.

Zaffino acknowledged those advances during his remarks for analysts and investors, adding that the company is working carefully on the project at multiple levels.

“We continue to make considerable progress on a number of fronts,” Zaffino said. “Our goal is to deliver a clean separation with minimal business disruption [with] an emphasis on speed, execution, operational efficiency and thoughtful talent allocation.”

To get there, Zaffino said, AIG is focused on “many work streams,” including designing an operational model that will help Life & Retirement be successful as a standalone public company. There is also a focus on separating IT systems, data centers, software applications, real estate and material vendor contracts.

Anther task on the list: Zaffino said executives are “determining where transition services will be required, and minimizing their duration with a clear exit plan.”

Now that the Blackstone deal is closed, Zaffino also noted that AIG will begin moving “certain assets under management” to the firm.