UBS to pay $15m plus up to $135m based on future earnings.
Swiss bank UBS is to buy the commodity index business of AIG Financial Products Corp, whose parent AIG is conducting a massive asset sale to pay off US government loans. The deal includes AIG’s rights to the DJ-AIG Commodity Index.
The commodity index business comprises a product platform of commodity index swaps and funded notes based on the Dow Jones-AIG Commodity Index.
UBS will pay $15 million, payable on closing, and additional payments of up to $135 million over the following 18 months based on future earnings of the purchased business. The closing is subject to regulatory and other conditions. "No assurances can be given that any such conditions will be satisfied," UBS said.
The transaction is expected to close by May 2009.