AIG (NYSE:AIG) Reportedly Chooses Citigroup Inc (NYSE:C) and Bank of America (NYSE:BAC) Over Goldman Sachs (NYSE:GS) for Restructuring Advice

AIG (NYSE:AIG) has changed course and decided to go with Citigroup Inc (NYSE:C) and Bank of America (NYSE:BAC) to advise them on restructuring the business, changing their mind on their original plan to have Goldman Sachs advise them on the matter.

Two unnamed sources have said AIG met Thursday with Citigroup and Bank of America officials to discuss the situation.

While some are making this look like it could become a contagion, it’s doubtful that will be the case, as the expertise in matters like these by Goldman is well known, and many companies would be foolish to respond to the media-inspired frenzy targeting Goldman Sachs as a reason to not use their services.

As far as this particular instance with AIG, they are not exactly in good public shape either, and to include Goldman with them probably would have generated more negative media coverage, so it’s likely that is behind the decision, more than anything else.

Even so, Goldman was was hired earlier in the year to handle business for AIG when they sold their American International Assurance and American Life Insurance units to Prudential Plc (LON:PRU) and MetLife Inc (NYSE:MET). Citigroup has also advised AIG on those deals as well.

Another reason it’s doubtful this is a beginning of an exodus for companies doing business with Goldman is they strongly benefited from the bailout money used for AIG, and that has come under scrutiny, along with their overall role in the bailout of AIG.

So this is unique to AIG, and to work with Goldman again in this situation could entangle them in a mess they just don’t want to, or need to, deal with at this time.