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The U.S. Treasury Department is selling $6 billion worth of American International Group stock and struck another deal for the insurer to pay down $8.5 billion more in obligations, taking a major step forward in an election year to unwind the unpopular crisis-era bailout.

ÌìÃÀÍøÕ¾´«Ã½´«Ã½ said the agreement with the government would allow it to pay down what it owed in a special purpose vehicle, AIA Aurora, and free up the company’s collateral against that, including interests in aircraft lessor International Lease Finance Corp and Asian insurer AIA Group Ltd.

The special purpose vehicle was set up in December 2009 in exchange for a reduction in the debt that ÌìÃÀÍøÕ¾´«Ã½´«Ã½ owed the New York Federal Reserve at the time. The Treasury’s original interest in the vehicle was $16 billion.

The stake sale is expected reduce the U.S. government’s ownership in ÌìÃÀÍøÕ¾´«Ã½´«Ã½ to about 70 percent from 77 percent, a source with knowledge of the situation said.

Once the company repays Treasury for the special vehicle interest, the value of the government’s stake would total about $41.8 billion.

The announcements come as President Barack Obama, a Democrat, fights to win a second term in office and withstands attacks from Republicans for wasting taxpayer money.

“The bottom line is this: the people of ÌìÃÀÍøÕ¾´«Ã½´«Ã½ have achieved another significant milestone in our progress toward our goal that American taxpayers recoup their entire investment in ÌìÃÀÍøÕ¾´«Ã½´«Ã½ at a profit,” ÌìÃÀÍøÕ¾´«Ã½´«Ã½ Chief Executive Robert Benmosche said in a statement.

Earlier this month, ÌìÃÀÍøÕ¾´«Ã½´«Ã½ sold part of its stake in AIA to raise about $6 billion to repay the government. Following the share sale, ÌìÃÀÍøÕ¾´«Ã½´«Ã½ holds about 19 percent of AIA.

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