American International Group Inc. Chief Executive Robert Benmosche appears to be taking on one of the toughest battles of his life in his inimitable scrappy style.
AIG said Monday that its 66-year-old CEO had cancer and was undergoing “aggressive chemotherapy.”
Benmosche said in a letter to employees that he began the treatment last week and felt fine, although the long-term prognosis would be clearer over the next couple of months.
In the meantime, he told employees, it was business as usual and that he was now “even more committed to working with all of you to turn AIG into the success story we all envision.”
“As I have said before, I have every intention of staying at AIG and seeing that path completed,” he said in the letter, obtained by Reuters. “It’s a turnaround I want to complete.”
Benmosche, who has said he plans to retire sometime in 2012, took over as CEO in August last year, as AIG was struggling to sell assets to repay the U.S. government after receiving a $182.3 billion taxpayer-funded bailout package during the crisis.
Soon after taking over as CEO — the fourth person to hold the top AIG job since June 2008 — Benmosche reversed course on strategy.
He stopped sales of assets that were drawing fire sale prices, tried to boost employee morale, and took on AIG’s critics — including government officials.
Just days after taking office, during a closed-door staff meeting in Houston, Benmosche said New York Attorney General Andrew Cuomo “doesn’t deserve to be in government” and had acted like a “criminal.’‘
He later said he regretted those comments, which were meant to bolster a demoralized AIG work force.
Brooklyn-born Benmosche, a former CEO of MetLife Inc., prides himself on a reputation for toughness.
He has said he developed a scrappy, can-do approach after his father died young, leaving his mother to pay off a large debt on a family hotel in a resort town in the Catskill Mountains of New York state.
“I was outspoken when I first got there (AIG) and people wanted to know what kind of leader I will be,” he told Reuters in an interview just days after the Houston meeting last year.
Since then, Benmosche has led a surprising turnaround for AIG, bringing the insurer to a point where the government has an accelerated path out of its investment in the company.
AIG has reached deals for several large ticket divestitures, including selling $17.9 billion of shares in an IPO of its Asian life business AIA and a $15.5 billion sale of another foreign life unit, American Life Insurance Co to Metlife.
It has also mostly wound down Financial Products, the unit that was behind its near-collapse in September 2008.
“Had this happened (cancer) three or four months ago it would have occasioned more fright for a path forward for the organization,” said Clark Troy, an analyst at Aite Group.
“Now I think it’s more of a question of finding the right person and concern for Benmosche personally,” Troy said.
Benmosche, who has a head of silver hair and an imposing presence, displayed no signs of illness during an interview on a rainy morning last month at his downtown Manhattan offices.
He expressed confidence about AIG’s future as an independent company after announcing the exit plan deal with the government on Sept 30.
“Now the debate is how much the government will make on AIG,” Benmosche said. “Is it a billion, is it 10 billion? They are not talking about a $30 billion loss anymore.”
Only a few days after taking over as the CEO last year, Benmosche left for a holiday to oversee the harvest of his vineyards from his villa in Dubrovnik, Croatia.
The villa, with terraces that stretched across 160 or 170 feet (49 or 52 metres) of sea front, has 12 bathrooms.
He bought the stone house (then a “complete wreck” in his words) in 2001 for about $1 million, and has since spent several times that amount in rebuilding the house and gardens.
“My children worry about how do they reach my level,” he said during that interview in 2009 in Croatia. “I suspect my son has a better chance because he is in real estate. My daughter is going to be a rabbi, so as a rabbi I don’t think she will ever make the kind of money CEOs make. But they were worried about how do they afford this.”
“So everything I’m doing, whether it is in New York or here, you will see, provides income. I want to make sure the estate I leave behind not only provides value but is a viable business.”
In a year, Benmosche said at the time, he hoped to wow people with AIG’s performance.
(Editing by Ted Kerr and Carol Bishopric)
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