More than four years since it first stepped in to bailout embattled insurance giant American International Group, Inc. (AIG), the U.S. Department of the Treasury announced that it has agreed to sell all of its remaining common shares in the firm.

The Treasury said Tueday that it will sell its remaining 234 million shares of AIG common stock at US$32.50 per share in an underwritten public offering, which is expected to generate aggregate proceeds to Treasury of approximately US$7.6 billion. After the closing of today’s offering, Treasury will continue to hold warrants to purchase approximately 2.7 million shares of AIG common stock.

Over the last 19 months, Treasury has conducted six public offerings of AIG common stock, selling a total of 1.655 billion shares (originally 92% of AIG’s outstanding common stock) at an average price of US$31.18 per share. Its US$20.7 billion offering in September represented the largest single U.S. common stock offering in history, Treasury notes.

“Since the financial crisis, AIG has undertaken a dramatic restructuring effort, which put it in a stronger position to repay taxpayers. The size of the company has been cut nearly in half as it sold non-core assets and focused on its core insurance operations. AIG’s Financial Products unit is continuing to be wound down and has cut its legacy derivatives exposure by more than 93% to date,” Treasury reports.

Including today’s offering, the Treasury and the US Federal Reserve will have realized a combined US$22.7 billion return on their combined US$182 billion commitment to stabilize AIG during the financial crisis. Treasury has realized a positive return of US$5.0 billion and the Fed has generated US$17.7 billion, it reports.

Additionally, once this latest offering is complete, more than 90% of the US$418 billion disbursed under the so-called Troubled Asset Relief Program (TARP) will have been recovered through repayments and other income.

Greenhill & Co. served as Treasury’s financial agent in managing and disposing of Treasury’s investment in AIG. BofA Merrill Lynch, Citigroup, Deutsche Bank Securities Inc., Goldman, Sachs & Co. and J.P. Morgan Securities LLC have been retained as joint bookrunners for the offering.