Cendant Corp. on Monday boosted its offer for American Bankers Insurance Group Inc. 16 percent, to $3.1 billion, in an attempt to wrest the credit insurer from rival bidder American International Group Inc.
The move is the latest salvo in a battle pitting Cendant President and chief executive Henry Silverman against AIG Chairman Maurice Greenberg.
Cendant wants Miami-based American Bankers’ credit insurance products to add to an array of services and goods such as lodging, car rental and real estate brokerage it markets direct to consumers. American Bankers favors merging with AIG, the biggest U.S. financial company in terms of market value.
Silverman is a “Titan dealmaker and marketing guy,” and Greenberg is “a Titan of the financial-services industry,” said Gloria Vogel, an analyst at Advest Inc.
They’re also offering Titanic prices for American Bankers, which pays customers’ credit card and other bills in the event of death, disability or unemployment.
“It’s an amazing price,” and perhaps high enough to keep AIG from countering, said Steven Schwartz, an analyst at ABN Amro Inc. in Chicago. “What is attractive to Cendant is the ability to sell this product” through its existing marketing channels.
Stamford-based Cendant increased its offer to purchase 23.5 million shares of American Bankers for $67 a share in cash, and the remaining 18 million shares for $67 a share in Cendant. The offer, up from $58 a share, expires at midnight March 27.
American Bankers has already agreed to sell to New York-based AIG, which raised its bid to $58 a share in cash and stock, or $2.7 billion, to match Cendant two weeks ago. AIG is offering to pay cash for 51 percent of American Bankers’ stock and the rest in AIG stock.
In Monday’s trading, shares of American Bankers rose $3.75, to $65.75; Cendant fell 19 cents, to $40.62; and AIG rose $2.94, to $127.12.
