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Will Benmoche Light a Fire Under AIG's Divestiture?

You need a scorecard to keep track of who's coming and going at American International Group, which just hired former MetLife boss Robert Benmosche as the fifth CEO of the troubled insurer in five years.

So it's fair to ask: Is this guy a keeper? Maybe, particularly if he can light a fire under AIG's restructuring/divestiture program, which has been moving at a snail's pace for almost a year.

Benmosche, who ran what is regarded as the smartest insurer in the country during its biggest growth years, was probably picked for his ability to jumpstart comatose companies, even if it means administering electroshock.

Early in his career Benmosche worked at the brokerage firm PaineWebber, where he was responsible for folding a wounded Kidder Peabody into the parent company.

Then in 2000 he awakened MetLife, a sleepy mutual company, brought it public and grew it into the giant it is today, the country's largest life insurer with more than a half trillion dollars in assets.

So the 65-year-old Benmosche clearly has chops. But equally important is whom the board didn't pick: Paula Rosput Reynolds, the former Safeco CEO who was in charge of the AIG restructuring plan. As she got kicked to the curb, outgoing AIG CEO Ed Liddy said she "provided time for asset values to recover." Reynolds will leave in the fall.

What does this mean? Clearly the board wants the restructuring to move faster. AIG has been able to sell some of its smaller pieces, like its Tokyo headquarters. But it has failed to get rid of the bigger parts, even though the International Lease Finance unit had interest from overseas buyers and the foreign life insurance division, ALICO, apparently saw an offer from none other than Benmosche's former company, MetLife.

Perhaps Reynolds wanted more money for these units. Liddy's remarks about her could indicate that was true. Or perhaps Reynolds wanted to sell but Liddy believed that their management team had stabilized AIG and didn't need a fire sale.

Either way, there's a new sheriff in town. He may be ready to sell.

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