Opinion ID: 750081
Heading Depth: 2
Heading Rank: 3

Heading: Fischbach's Acquisition by AIG

Text: 17 In the meantime, several years prior to the 1993 Judgment, Fischbach was acquired by one of its creditors, American International Group, Inc., through a subsidiary (collectively AIG). By the spring of 1988, AIG had provided Fischbach with surety bonds whose outstanding amount was $500 million and had issued insurance on which Fischbach owed premiums totaling some $23 million. At that time, Fischbach's financial viability was in jeopardy due to the Posners' abuse of the company and the public disclosure of the harm it had caused. (Fischbach brief on appeal at 8.) Accordingly, AIG began discussing with Posner the possibility of acquiring his stake in the company. Those discussions culminated in an agreement dated November 30, 1989, in which the various corporations through which Posner held his Fischbach stock granted AIG an option to purchase that stock for $12 per share (or book value, if higher), a price term later reduced to $11 per share. On June 8, 1990, AIG exercised its option and acquired Posner's approximately 53% interest in Fischbach for $11 per share. 18 Six days later, AIG made a tender offer at $11 per share for all outstanding Fischbach stock. The tender offer documents distributed to Fischbach shareholders stated that AIG viewed Fischbach as being in financial distress. (AIG Tender Offer dated June 14, 1990 (AIG Tender Offer), at 8.) AIG stated that it sought to exercise control over the day-to-day operations of [Fischbach], and in doing so reduce the potential liability of [AIG] arising from the outstanding surety bonds on Fischbach projects. (Id.) The tender offer resulted in the increase of AIG's ownership of Fischbach to nearly 95%. On August 24, pursuant to Delaware law, AIG effected a freezeout merger, through which it acquired the remaining shares. Since that time, Fischbach has been a wholly-owned subsidiary of AIG.