USF&G Sells Majority Interest in Investment Management Subsidiary
BALTIMORE (AP) _ USF&G Corp, the troubled insurance giant, on Thursday sold a majority interest in an investment management subsidiary to employees as part of its corporate restructuring.
The Baltimore-based company sold a 51 percent share of Chancellor Inc. to its professional staff, retaining 49 percent. The sale price was not disclosed.
″The price of the sale is equal to the value of our investment,″ said USF&G spokesman Paul Schlough.
Norman P. Blake Jr., chairman, president and chief executive officer of USF&G, said the company was restructuring to focus resources on its core insurance business.
USF&G, the nation’s 13th largest property and casualty insurer, has been undergoing a major corporate restructuring and cost-cutting program since losing $569 million in 1990.
It has laid off 2,000 workers and slashed its dividend, while abandoning unprofitable insurance markets, shedding money-losing junk bond and real estate investments and non-insurance subsidiaries. The company lost $176 million in 1991, its recovery hampered by a downturn in the insurance industry.
Chancellor is one of the nation’s largest institutional investment management companies and runs more than $25 billion in assets, said company spokeswoman, Alexandra Trower. It handles investments for public and private pension funds, insurance companies, mutual funds and charities.