AIG To Sell Taiwan Insurance Firm For $2.15 Billion

New York, NY (AHN) – American International Group Inc. will sell a life insurance unit in Taiwan for $2.15 billion. The money will be used to repay its bailout from the U.S. government.

Primus Financial and China Strategic Holdings Ltd. will buy AIG’s 98 percent stake in Taipei-based Nan Shan Life Insurance Co., AIG said in a statement.

China Strategic will have an 80 percent stake in the group buying Nan Shan, and Primus Financial will own the remainder, Primus founder Robert Morse said in a telephone interview, according to Bloomberg. Some 80 percent of the purchase price will be paid in cash, with the remaining funds from bank loans.

AIG was one of the firms deemed “too big to fail” last fall by the federal government after the company experienced a financial crisis related to its investments in mortgage-backed securities. It was rescued by a $182.3 billion bailout. The sale of Nan Shan is intended to help pay off the government loan.

Robert Benmosche, AIG’s chief executive, said the buyers would maintain the Nan Shan brand, existing pay and benefits, and organizational and commission structure for at least two year. The current management team will remain.

Nan Shan is the largest life insurer in Taiwan by book value and the third largest by total premiums, according to AIG.

AIG has raised another $12 billion in repayment funds by agreeing to sell a majority interest in reinsurer Transatlantic Holdings Inc., a Tokyo office tower and an equipment insurer.

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