American International Group’s sale of a minority stake in its Asian life insurance unit faces an uphill climb in a down market.
via AIG finding Asian assets a tough sell – International Herald Tribune.
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I think most people don’t know how to estimate AIA’s value and are making erroneous assessments of its worth.
The core element that contributes to AIA’s success is not anything related to its corporate structure or management virtuosity. It is the sales force. The sales operation, which has long been adopting a so-called success-oriented policy in training its salespeople, supports the marketing department effectively, making it possible for the company to realize many aggressive, though controversial, strategies in the market.
However, the sales force is very much an illusive entity in the sense that it may strive to protect its own worth sometimes by making disloyal moves. These people are grouped in big districts (teams). They move in herds. Once they find there is a better nest to hatch their eggs or a threat to its well-being, they will not hesitate to show a meek face to their existing master.
The risk of an empty nest could pose a lethal trap to bidders who act with a robust expectation.
