Thanks, Hank? AIG Succession Plans Might Not Shield Stock From Shocks
When American International Group's charismatic Chairman and Chief Executive Maurice R. "Hank" Greenberg eventually leaves, many investors think AIG's stock will suffer. Others aren't so certain.
Mr. Greenberg, 78 years old, bristles at talk of retirement. But plans for succession have come into sharper focus: Director Frank Zarb, chairman of the American International Group board's executive committee, would become interim chairman and lead the selection of a new chief executive. The current top contenders now include Tokyo-based Donald Kanak, head of AIG's Japanese and Korean operations, who previously was seen as a secondary candidate.
The increased clarity on the AIG succession issue will come as welcome relief for investors who have expressed concern about the company's coyness on the issue. Yet the succession news doesn't mean AIG's share price is safe from aftershocks when Mr. Greenberg does leave, whether he retires or dies in the saddle.
Few companies are so strongly identified with a single man, and investors and analysts say Mr. Greenberg's eventual departure will likely prompt a re-evaluation of AIG's stock and its all-important triple-A debt rating.
"Hank is good for the stock in that his departure will hurt the stock, regardless of how good a successor they put in there, just because the next guy has to prove himself," says Gary Ransom, an analyst at Fox-Pitt, Kelton in Hartford, Conn. "We don't know who [the successor] is, so he doesn't have a chance to prove himself ahead of time."
Mr. Greenberg, while usually not providing a lot of guidance on succession, has often touted the strength of the company's executive "bench" and stressed that the company focuses on long-term results, rather than trying to react to market conditions. "We manage our company to achieve the strongest possible performance for shareholders over the long term," Mr. Greenberg said in the company's annual report.
And under Mr. Greenberg, shareholder returns have been strong. In the past 10 years, AIG shares have gained 318% compared with a 159% gain for the Dow Jones Industrial Average. In 4 p.m. New York Stock Exchange composite trading Tuesday, AIG rose 58 cents to $60.58.
Given the success of AIG's stock under Mr. Greenberg, there's no question that investors are keenly interested in who will follow him. Indeed, when succession issues at AIG make news, the company's share price moves. For example, when Mr. Greenberg's son Evan, then the company's heir apparent, left abruptly in September 2000, the company's share price rose $1.75 to $90.13. And when rumors circulated that Mr. Greenberg was ill in early 2002, the company's stock price fell; not long afterward, the insurance giant rearranged its management team, reassuring investors and analysts that skilled executives were in place for the day Mr. Greenberg retires or dies. That news prompted the company's share price to rise $1.49 to $70.61 a share.
The spring-of-2002 executive shuffle installed Martin Sullivan and Edmund Tse as co-chief operating officers, and observers generally concluded that Mr. Sullivan, 49, was a more likely successor than Mr. Tse, 65. Analysts pronounced themselves satisfied that the company had a deep enough bench to take over if Mr. Greenberg were suddenly removed from the picture.
Even so, for years some investors have speculated that Mr. Greenberg ultimately hopes to bring back one of his sons to succeed him. Evan Greenberg is now president and chief operating officer of Ace Ltd., an AIG competitor whose chief executive, Brian Duperreault, was once an AIG executive. Son Jeffrey W. Greenberg, who was seen as his father's heir apparent when he left AIG in 1995, is now chairman and chief executive of Marsh & McLennan Cos., the financial-services firm whose Marsh unit is the world's largest insurance broker.
Mr. Greenberg says he's proud of his sons but won't be bringing them back to run the company.
Despite last year's management shake-up, succession details remained too sparse to satisfy some. In February, after Mr. Greenberg said the board knew who would succeed him, Kathy Shanley, a senior bond analyst at research service Gimme Credit, called it too little to allay succession worries entirely. Succession "remains an issue, despite the recent coy statement by Chairman Maurice 'Hank' Greenberg ... that the company had chosen a current [unnamed] insider to succeed him," she wrote.
One question that will need to be answered once Mr. Greenberg leaves the company is what happens to AIG's cherished triple-A debt rating.
"When he leaves it would be insulting to say that it would have no negative effect on the company's position," says Steve Dreyer, managing director at Standard & Poor's insurance ratings group. "Whether it affects the company's prospective financial strength is a question you have to answer."
While groups such as S&P and Moody's Investors Service base their ratings largely on a company's financial position, there is a forward-looking element to the ratings.
"A good part of our analysis is qualitative," Mr. Dreyer says. "There are things you can't measure: the aggressiveness of the company, the claims-handling processes, the way it invests, how nimble it is when faced with adversity. At the end of the day it's a personality the company has. In the case of AIG, it's very much set by one person."
Mr. Dreyer says it's most likely that S&P wouldn't change its rating. But if such a downgrade did happen, it could cost AIG some business it wins on the basis of its financial strength. That's particularly true at a time when many insurers -- hit by $40 billion in losses from Sept. 11 and mounting asbestos liabilities -- have already seen their ratings slip. Mr. Dreyer notes that in Asia, AIG's strength and security are key to its success in markets where the local competitors wouldn't even rate as investment-grade companies.
Some investors and analysts say the uncertainty surrounding succession at AIG has already depressed the company's share price. And AIG is generally mum about many matters. The company has generally tight disclosure policies and rarely answers questions about its corporate governance.
So despite "a tremendous amount of respect" for Mr. Greenberg, investors today are penalizing AIG shares for the company's lack of clarity on succession and other issues, says Bill Cross, an analyst covering insurance stocks for mutual-fund manager Eaton Vance Management, which held about $359 million in AIG shares on March 31.
"One might even suggest that the discount for lack of clarity on the succession is approaching the premium for Mr. Greenberg's remarkable record," adds Mr. Cross. He notes that AIG trades at about 14 times a consensus estimate of its 2004 earnings of $4.36 -- roughly 81% of the earnings multiple of 17.4 times 2004 earnings for the S&P 500-stock index.
Some investors believe Mr. Greenberg's eventual departure is only one issue facing AIG. The company also faces slowing premium growth for property-casualty insurance and uncertainty over proposals for tort-reform and asbestos-settlement legislation. "Will the stock go down if something happened to Hank Greenberg?" says Robert Shelton, manager of AIM Premier Equity Fund, which held about 2.3% of the fund's $9.1 billion assets in AIG shares as of June 30. "You bet. But I don't think the discount the stock is trading at right now is particularly related to the succession issue."
In the end, investors are going to have to resign themselves to the prospect of change, says David Schiff, editor of Schiff's Insurance Observer, an influential industry newsletter.
掌门人问题困扰AIG
许多投资者认为，当美国国际集团(American International Group Inc.,AIG)具有超凡魅力的董事长兼首席执行长格林伯格(Maurice R. 'Hank' Greenberg)最终离职后，该公司的股票将蒙受打击，还有些人则不这么确定。
虽然78岁的格林伯格一听人们谈论他退休就怒发冲冠，但公司为他物色继承人的计划却日渐明晰：现任公司董事会执行委员会主席的萨博(Frank Zarb)将担任公司的临时董事长，领导新任首席执行长的挑选工作。美国国际集团的日本和韩国业务负责人卡纳克(Donald Kanak)目前在角逐首席执行长一职的竞争中位居前列，他以前被认为是这一职位的二类候选人。
美国国际集团接班事宜的进一步明朗是件令投资者欣慰的事，他们已因该公司在这件事上的态度躲躲闪闪而心存疑虑。但这并不意味著，一旦格林伯格真的卸任－－无论是退休还是“光荣殉职”，美国国际集团的股价肯定能安然度过此事引发的冲击波。
没有几家公司的命运如此强烈地等同于某个个人，投资者和分析师们说，格林伯格的最终离去预计将会引发对美国国际集团的股价和AAA债务评级的重新评估。
Fox-Pitt, Kelton的分析师加里?兰瑟姆(Gary Ransom)说，格林伯格对美国国际集团股票的意义在于，不管该公司选定的接班人多么优秀，他的离去都将会对该股造成损害。因为这位继任人不得不证实自己的能力，外界并不知道此为何人，所以他也就没有机会在接班前证实自己的能力。
格林伯格虽然通常不对接班人问题多作暗示，但却经常对公司领导班子的能力大加夸赞，并强调说，公司关注的是长期业绩，不会在回应市场情况上多费工夫。他在公司的年报中说，管理层旨在使公司在长期内为股东取得可能达到的最佳业绩。
在格林伯格的领导下，美国国际集团的股权回报率一直很好。过去10年中，该公司股价累计上涨了318%，而道琼斯工业股票平均价格指数的同期涨幅仅有159%。美东时间周二下午4点，在纽约证交所的综合交易中，该股上涨58美分，至60.58美元。
鉴于格林伯格领导下的美国国际集团股票表现优良，投资者无疑对谁将接替他领导该公司抱有浓厚兴趣。事实上，每当该公司在接班问题上有什么新消息传出，公司股票就会出现波动。例如，当时被公认为是公司接班人的格林伯格之子埃文(Evan)于2000年9月突然离开公司后，该公司股价涨了1.75美元，达到90.13美元。而当2002年初有传言说格林伯格健康欠佳后，该股价格应声下跌；不久后，这家保险业巨头重组了其管理团队，从而使投资者和分析师们确信，该公司为应对格林伯格或退休或去世的可能局面，已预先安排妥了称职的管理人员。这则消息推动该股价格上涨了1.49美元，升至70.61美元。
2002年春的这次管理层大改组，将马丁?沙利文(Martin Sullivan)和艾德蒙?谢(Edmund Tse)推上了联席首席营运长的职位，观察家们普遍认为，49岁的沙利文比65岁的谢更有可能成为格林伯格的继任人。分析师们声称，他们感到高兴的是，该公司的管理层中有如此多的后备人选，即便出现格林伯格突然撒手离去的局面，美国国际集团也不必担心后继乏人。
即使如此，几年来仍有一些投资者猜想格林伯格最终还是希望能把他的某个儿子弄回来接班。埃文?格林伯格是Ace Ltd.的总裁兼首席营运长，这家公司是美国国际集团的竞争对手，该公司首席执行长布莱恩?杜普雷特(Brian Duperreault)也曾是美国国际集团的管理人士。格林伯格的另一个儿子杰弗里?W?格林伯格(Jeffrey W. Greenberg)目前担任金融服务公司Marsh & McLennan Cos的董事长兼首席执行长，其子公司Marsh是世界最大的保险经纪商。杰弗里在1995年离开美国国际集团前也曾被公认为格林伯格的接班人。
格林伯格说，他为他的儿子们感到骄傲，但不打算把他们请回来掌管美国国际集团。
尽管有了去年的管理层大改组，但有关该公司继任人问题的细节消息仍然太过匮乏，不能令人满意。今年2月，格林伯格称公司董事会知道谁是他的继任人，但研究服务公司Gimme Credit的资深债券分析师凯西?香利(Kathy Shanley)却说，格林伯格透露的信息太少，还不足以完全平息人们对继任人问题的担心。
她写道，尽管格林伯格最近闪烁其辞地说美国国际集团已挑选了一位公司内部人士来接他的班，但继任人问题仍未尘埃落定。
一旦格林伯格离开美国国际集团，迫在眉睫的一个问题就是，对该公司至关重要的AAA债务评级将会有何变化。
标准普尔公司(Standard & Poor's)保险评级集团的董事总经理史蒂夫?杜瑞尔(Steve Dreyer)说，格林伯格的离职不可能不对美国国际集团的债务评级产生负面影响，他离职这件事是否会对该公司的财务健康前景产生影响是个必须回答的问题。
尽管标准普尔和穆迪投资服务(Moody's Investors Service)对某家公司的评级大体都是以其财务状况为基础的，但其中也不乏前瞻性因素。
杜瑞尔说，他们的许多分析都是定性分析，有许多事情是你无法衡量的，如一家公司的进取性，其索赔受理程序，投资方式，以及应对逆境的敏捷程度等。总而言之，就是这家公司的个性。就美国国际集团而言，其个性很大程度上就是由一个人决定的。
杜瑞尔称，最有可能的一种情形就是标准普尔维持美国国际集团的评级不变。但如果出现下调评级的情况，该公司可能会失去一些其凭借财务实力获得的业务。在目前这样一个众多保险公司因911事件导致的400亿美元损失和越来越高的石棉案理赔义务而遭遇评级下调的时候，下调美国国际集团的评级是很有可能的。杜瑞尔指出，美国国际集团的实力和安全性是其在亚洲市场上获得成功的关键，当地保险公司甚至连投资级评级也达不到。
一些投资者和分析师认为，围绕继任人问题的不确定性已压低了美国国际集团的股价。该公司在许多问题上都是金口难开。这家公司倾向于从严掌握披露政策，很少回答有关其公司管理方面的问题。
负责为共同基金管理公司Eaton Vance Management追踪保险类股的分析师比尔?克鲁斯(Bill Cross)说，尽管投资者对格林伯格很尊敬，但他们还是因为美国国际集团在继任人等问题上缺乏透明度而惩罚了该公司股价。截至3月31日当天，Eaton Vance Management持有价值约3.59亿美元的美国国际集团股票。
克鲁斯称，甚至有人认为，在继任人问题上缺乏透明度对美国国际集团股价产生的负面影响，可能已接近抵消了格林伯格管理有方对该股产生的正面推动。他指出，以分析师对该公司2004年每股收益4.36美元的普遍预期计，美国国际集团股票的本益比约为14倍，而标准普尔500指数成份股以2004年收益计算出的本益比为17.4倍，前者仅为后者的81%左右。
一些投资者相信，格林伯格的最终离职只是美国国际集团必须面对的问题之一。该公司还须面对的问题有：财产-意外伤害险保费增长减缓，围绕有关民事侵权行为改革和石棉案和解立法的建议所引发的不确定性。AIM Premier Equity Fund的经理罗伯特?谢尔顿(Robert Shelton)认为，如果格林伯格出现什么状况，美国国际集团的股价肯定会下跌。但他本人并不认为美国国际集团的股价目前偏低与该公司的继任人问题有什么特别的关系。
颇有影响力的保险业刊物Schiff's Insurance Observer的编辑戴维?谢弗(David Schiff)说，归根到底，投资者还需使自己去适应变化。
