01/26/2016 08:19 EST | Updated 01/26/2017 00:12 EST

AIG selling broker-dealer segment, cutting expenses

NEW YORK — Insurer AIG is selling its broker-dealer segment, starting an initial public offering for its mortgage-insurance division and slashing expenses after coming under pressure from activist investor Carl Icahn.

Icahn has been pushing AIG to break itself into three separate companies.

American International Group Inc. said Tuesday that it will sell AIG Advisor Group to private equity firm Lightyear Capital LLC and Canadian pension investment manager PSP Investments. Terms were not disclosed.

The company said the IPO for up to 19.9 per cent of United Guaranty Corp. is a first step toward a full separation.

AIG also announced that it is looking to cut $1.6 billion of expenses within two years.

Its shares rose more than 1 per cent in premarket trading.

The Associated Press