WSJ: AIG Plane Leasing Exec May Bid for Assets

NEW YORK --

The head of the aircraft leasing company owned by the financial services company American International Group is reportedly talking about buying a part of the business. The aircraft leasing company has been up for sale for more than a year.

The Wall Street Journal reported Saturday that Steven Udvar-Hazy, a co-founder, chairman and CEO of International Lease Finance Corp., is in early discussions to purchase part of the leasing unit's portfolio and start a new company.

The newspaper, citing unidentified people familiar with the matter, also reported that a mid-September AIG board meeting is scheduled to discuss the potential deal.

The story didn't cite how much the proposed deal might be worth.

Messages were left and e-mail was sent to several AIG representatives for comment, but there were no immediate replies.

AIG is trying to sell assets to repay billions in federal loans that helped it avoid failing. The loan package was worth up to $182.5 billion and the government owns roughly 80 percent of the company.

The leasing company has about 950 planes, making up the world's second largest fleet. Its customers include American Airlines, Delta Air Lines, Jet Blue, and US Airways.

During the most recent fiscal quarter, the subsidiary's operating profit fall about 5 percent to $335 million, despite an increase in lease revenue as its fleet grew.

The subsidiary had to borrow $1.7 billion from AIG over the first six months of 2009 to repay debt and other obligations, AIG said in a Securities and Exchange Commission filing on Aug. 7. The parent company had total debt of about $30.4 billion as of June 30.