(Bloomberg) -- Carl Icahn, the billionaire investor known for picking fights with corporate boards, disclosed an investment in American International Group Inc. and said it should split into three companies, one offering property- casualty coverage, another selling life insurance and a third backing mortgages. The stock rallied in New York trading.
“There is no more need for procrastination,” Icahn said in a letter posted on his website Wednesday and addressed to AIG Chief Executive Officer Peter Hancock.“The time to act is now.” Icahn said on Twitter that he holds a “large stake” in AIG.
While AIG climbed about 8.8 percent this year through Tuesday’s close, the insurer still trades for less than 80 percent of book value, a measure of assets minus liabilities. Travelers Cos., the lone property-casualty insurer in the Dow Jones Industrial Average, trades for more than 1.4 times book value. AIG jumped 2.8 percent to $62.65 at 11:48 a.m., the most intraday since August.
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