AIG to Buy HSB Group for $1.2 Billion

Top U.S. business insurer American International Group Inc. agreed to buy specialty industrial insurer HSB Group Inc. for about $1.2 billion, or $41 a share, in a move to broaden its property and casualty business and expand abroad. Hartford, Conn.-based HSB is the parent company of Hartford Steam Boiler Inspection & Insurance Co., which has provided specialty property coverage since 1866. HSB stockholders would receive $41 worth of AIG stock or a combination of stock and cash, at AIG’s option, for each share they own. HSB shares rose $1.25 to close at $39.94, and AIG fell 56 cents to close at $86.94, both on the NYSE.