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August 30, 2011updated 13 Apr 2017 8:48am

AIG gets go ahead for Nan Shan Life sale

Almost two years on, American International Group (AIG) has finally received approval from Taiwans Financial Supervisory Commission (FSC) to sell its 97.57 percent stake in Nan Shan Life to a consortium led by a unit of Taiwanese conglomerate Ruentex Groups Ruen Chen Investment Holding Company

By LII editorial

Almost two years on, American International Group (AIG) has finally received approval from Taiwan’s Financial Supervisory Commission (FSC) to sell its 97.57% stake in Nan Shan Life to a consortium led by a unit of Taiwanese conglomerate Ruentex Group’s Ruen Chen Investment Holding Company. The cash deal is worth $2.16bn.

The deal with Ruen Chen Investment and its partner, Taiwanese footwear manufacturer, Pou Chen Corporation, was announced in January 2011.

The deal followed the FSC’s rejection of a $2.15bn bid for Nan Shan made by a consortium led by Hong Kong-based financial services company Primus Financial.

The FSC has placed a number of conditions on the deal with the Ruen Chen consortium. Among these, the consortium must deposit TWD6bn ($206m) into a special custody account as a form of security.

Established in 1963, Nan Shan is Taiwan’s largest life insurer by total book value and third largest by total premiums behind Cathay Life and Fubon Life.

Nan Shan, which reported premium income of TWD212bn in 2010, has four million policyholders, eight million policies in force, 24 branches, 500 agency offices, about 4,100 employees and 33,000 agents. Nan Shan has total assets of about TWD$1.8trn.

AIG anticipates reporting a $1.4bn loss on the sale of Nan Shan.

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