AIGin $2.15bn Taiwan sale
INSURER American International Group (AIG) has finally struck a deal to sell its Taiwanese life insurance arm for $2.15bn (£1.36bn), in a key step in its bid to pay off its $80bn government bailout.
AIGsold its Nan Shan Life arm to two little-known buyers – a start-up financial group run by a former Citigroup banker and an obscure, publicly traded Hong Kong holding company with a market value of $111m.
The agreement will likely to bring a sigh of relief to the AIG camp as, at one point, it looked liked the process would not succeed.
Primus Financial, the firm founded by Citi’s former Asia investment banking head, together with China Strategic Holdings, are to buy Nan Shan Life, ending a five-month auction that involved private equity firms and local financial groups.
Nan Shan, a top-three Taiwan insurer, has assets of $46.4bn and employs 36,000 sales agents in Taiwan and has a market share of 10 percent with its 4m customers.
Primus will own around 20 per cent of the business and China Strategic 80 per cent, according to the companies.
The sale allows AIG to check one business off its list of units to sell in fund-raising efforts.
Its Hong Kong-based life insurer AIA is seeking a more-than $2bn initial public offering (IPO). Its American Life Insurance arm, which generates half of its revenues in Japan, could fetch $5bn in an IPO.
China Strategic, whose businesses include battery production and securities investments, had said it planned to raise about 7.8bn Hong Kong dollars to fund a possible joint acquisition.