In the announcement, AIG has declared selling up its 19.9% stake in United Guaranty. In February, AIG has added Icahn representative and billionaire John Paulson to board in a bid to avert boardroom fight, reports Reuters.

The regulatory filing by United Guaranty appears at a quiet time for the US IPOs. The number of public offerings is lowering now a day following existing volatility in the market. Only nine health care companies have been witnessed to go for public this year since others across several industries have postponed their offerings, reports The Business Times.

United Guaranty is the largest mortgage guarantor amongst AIG's US peers. Businesses of the second largest enterprise, Radian Group Inc. have been reduced 8% this year due to stricter capital rules coupled with heightened competition. Paulson, the recently nominated AIG board member has investment in Radian.

The AIG mortgage insurer has recorded net income of $359.8 million during last year which is 8.6% lower compared to that of a year ago. Meanwhile, revenue has been witnessed to decline by 11% to $922.6 million during the 12 months through December.

Businesses of United Guarantee have been deemed more risky by Standard & Poor's following announcement for spinning off. The downgrading in rating takes place this month citing reason that the company won't get implicit ongoing support from the parent company after the separation. Notably mentioning, United Guaranty intends to get enlisted with the New York Stock Exchange.