Current event AIG

Current event AIG - Reserve took a majority stake in the...

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Ali Ahmed 09/10/2009 Prof Willenborg Current Events: AIG axes Manchester United Recently, insurance giants AIG (American Insurance Group) announced that they were ending their sponsorship deal with British football giants, Manchester United. The deal, which began in 2006, was worth near $100 million at that time (57 million pounds, with 2006 exchange rate). Although this is a setback for the British team, as 1/3 of its revenues come from lucrative sponsorship deals, the Football giants are already finalizing talks with another insurance sponsor, AON, to take over once the current AIG sponsorship runs out in May 2010. AIG have issued statements of regret over the cancellation, but claims that it desperately needs to cut back unnecessary costs, and it needs to reconsolidate its operations and marketing strategy. AIG is now a well known name, thanks to the economic crisis. Last September, AIG was booted out of the Dow Jones Industrial Index of leading companies days before the U.S. Federal
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Unformatted text preview: Reserve took a majority stake in the insurer. Subsequently, AIG has been bailed out multiple times from the US government (including an initial $150 billion). Consumers will also remember that there was widespread anger after it was revealed that AIG was going to pay bonuses to its executives, and was still mismanaging bailout money. Amid all this, the insurance giant decided to cut its sponsorship with Manchester United. What remains to be seen is whether this really was a sincere move on part of AIG, and a new strategy that cuts back costs, and more efficiently uses bailout money, or just another ploy to fool consumers into thinking that they had become more cost conscious. In the meanwhile, Manchester United keeps its AIG jersey for the rest of the season and continues the hunt for more trophies. *Base Article found at http://money.cnn.com/2009/01/21/news/international/uk_soccer/index.htm*...
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