October 9, 2008 12:43 PM

Davis Polk, Sullivan on New AIG Loan

Posted by Zach Lowe

Its been a tough week for AIG, what with Congress slamming the $440,000 getaway that AIG execs escaped to a week after the government loaned the company $85 billion.

Now comes news that AIG needs $38 billion more because it already has drawn down about $61 billion of the original loan.

AIG has turned to the same advisers who secured its first loan--a Sullivan & Cromwell team led by (drum roll) . . . H. Rodgin Cohen. Cohen's been so in demand, The Wall Street Journal dubbed him the "lawyer for all Wall Street" in a profile today.

As The Am Law Daily has noted repeatedly, Cohen and his team, which often includes Mitchell Eitell, has represented just about everyone caught up in the economic crisis, including AIG, Lehman Brothers, and Wachovia. In fact, we named Cohen and Eitel two of our first three weekly Dealmakers of the Week.

Davis Polk also has been in the muck from the beginning. They advised Freddie Mac in the first major government bailout, and they continue to advise the Federal Reserve in its negotiations with AIG, a firm spokesman says.

This loan will work differently from the first one, The New York Times and Washington Post report. The government will hold $37.8 billion in AIG's fixed-income securities as collateral in exchange for cash, which AIG will use to sure up liquidity for its own securities-lending business.

The Davis Polk team includes partners Donald Bernstein, Randall Guynn, Marshall Huebner, Ethan James, Peter Levin, and Bradley Smith, the firm says.

Related stories:
Davis Polk, Sullivan, Simpson on Fed's Bailout of AIG
AIG Leans on Sullivan & Cromwell Heavy Hitters in Struggle to Stay Afloat

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