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Hartford Steam Boiler Confirms It's For Sale

By ERIC GERSHON

October 10, 2008

The Hartford Steam Boiler Inspection and Insurance Co. confirmed Thursday that it has been put up for sale by its troubled parent, American International Group.

But Hartford Steam declined to provide details about any deal that might be in progress or what a sale might mean for hundreds of Connecticut employees.

"I can say that Hartford Steam Boiler is taking a proactive role," spokesman Dennis Milewski said Thursday. "We are actively engaged in shaping our own destiny."

Bloomberg News, citing sources, reported Wednesday that AIG, which bought the 142-year-old Hartford Steam Boiler for $1.2 billion in 2000, has hired the New York investment bank KBW Inc. to find buyers. Representatives from AIG could not be reached for comment Thursday.

In statements released by HSB Thursday, executives portrayed a sale as an opportunity and stressed the company's solid finances and reputation. But they gave few clues about what might happen to the company's 398 Connecticut employees, nearly all of whom are in downtown Hartford.

"We believe that this decision provides HSB with a great opportunity for a new beginning with another partner that can help us further our success," said Douglas G. Elliot, HSB's president and chief executive.

Chairman Richard H. Booth said the decision "will not impact Hartford Steam Boiler's strong commitment to the greater Hartford community. HSB will continue to support the many key initiatives that we are deeply connected with and work to help them succeed. HSB has long been a leader in efforts to sustain and enrich our region and our people will continue to play an important role in the life of our community."

AIG was once the world's largest insurer. But more than $18 billion in losses related to the housing market prompted a bailout loan from the federal government. Now AIG plans to sell assets to help repay its initial $85 billion loan. On Wednesday the Federal Reserve agreed to lend the company an additional $38 billion.

HSB, which employs 2,485 worldwide, provides insurance for various mechanical and electrical systems.