AIG Spikes; Still A Good Company, Berkowitz Says

[Stocks-to-Watch]

Shares of American International Group (AIG), which had been down 2% most of the day, are up $2, or almost 6%, at $36.22, following an article by David Henry of Bloomberg in which Fairholme Capital Mangement’s chairman, Bruce Berkowitz, said Fairholme’s managed accounts and mutual funds have taken “significant stakes” in AIG since the fall of last year, totaling 13 million shares, roughly 10% of the 135 million shares outstanding.

Fairholme also holds “hundreds of millions of dollars of the debt” of AIG, reports Henry.

“It is still a good company with a good global brand,” Berkowitz is quoted as saying, adding, “AIG has “done a reasonable job of walling off the remaining risks.”

Berkowitz expects AIG may raise funds from private investors.

Berkowitz has been named stock-fund manager of the decade by Morningstar, and his Fairholme Fund earned a 13% return, on average, over the last 10 years, Henry notes.



Original Article Source by Barrons.com