The board of American International Group Inc., the insurer being pressured by billionaire investor Carl Icahn to split up, will be expanded to 16 directors from 14.
The change means a representative of Icahn will sit on the board alongside Peter Hancock, the chief executive who has dismissed the activist campaigners’ break-up idea as failing to make “financial sense”.
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Icahn has previously accused the insurer executives for failing to meet profitability targets, and “misleading” investors.
He and Paulson pressured AIG to focus primarily on property-casualty coverage. Icahn has said the plan announced in January by the insurer to exit smaller assets, including the mortgage guaranty business and a broker-dealer network, is not enough of a drastic change.
In a statement on Thursday Icahn said: “We continue to believe that smaller and simpler is better and look forward to working collaboratively with the board and management, ” adding that he declined to join the panel because of his busy schedule.
Icahn said board additions should “help catalyze a turnaround in core P&C operations, a more transparent operating structure, and the ultimate shedding of the SIFI designation, ” a tag given to systemically important financial institutions that are subject to heightened regulation.
“We commend the board for adopting a number of our recommendations over the last few months, ” he said, adding he looked forward to “working collaboratively” with the incumbent directors.