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AIG, China Strategic Holdings extend deadline for unit deal

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US insurance giant American International Group (AIG) and a Hong Kong consortium said Monday they had agreed to extend the deadline for a deal involving AIG’s Taiwan subsidiary.

Hong Kong-based China Strategic Holdings and Primus Financial Holdings in October agreed to acquire AIG’s Taiwan unit Nan Shan Life for 2.15 billion US dollars, pending approval from Taiwan’s financial regulator. But the deal has been in limbo since November, when China Strategic announced a plan to sell a 30 percent stake in Nan Shan to the Taipei-based Chinatrust Financial Holding Co.

The two sides agreed to extend the deadline from July 12 to October 12 “in order to accommodate the completion of the sale of AIG’s stake in Nan Shan Life Insurance Company, Ltd. to the consortium,” they said in a joint statement. “The extension of the date of the purchase agreement underscores the commitment of both parties to the successful close of the transaction,” the statement said.

The consortium has repeatedly denied rumours that surfaced late last year that mainland Chinese capital was involved in the deal. Taiwan has partially lifted a decade-old ban on investment from the mainland amid improving ties between Taipei and Beijing after President Ma Ying-jeou took office in 2008 on a China-friendly platform. However, the Taiwan government still imposes various restrictions in key sectors such as finance, flat-panel technology and telecommunications as it seeks to keep control of its economy.

Taipei, June 21, 2010 (AFP)