For example, government injected 85m to AIG, so now government is a larger shareholder of the AIG?
AIG yes, others maybe.
It depends if the fed buys new stock (then yes and the company gets the money), stock in the market (then no and company gets $0), or buys bonds isuued by the company (they not a shareholder, but the company gets the money, it is just a loan)
in the particular AIG case, this has occurred
The Fed said in return for the loan, the government will receive a 79.9 per cent equity stake in AIG.
However, other bail-out may entail getting another company to help with the take-over, and the government taking some of the losses of the debts : see washington mutual or wachovia.
No comments:
Post a Comment