AIG to buy 21st Century Auto Insurance

American International Group Inc. (AIG) said it had reached a definitive agreement to buy out the minority shareholders in auto insurer 21st Century Insurance Group which it already controlled, after raising its previous bid.

The agreed offer, of $22 a share in cash, was increased from an initial January bid of $19.75, a move some investors had expected since an independent committee of 21st Century's outside shareholders had to approve the deal.

AIG, the world's largest insurer, which already controls 60.8 percent of 21st Century, said the total purchase price for the shares was about $813 million.