The Taiwanese financial regulator on Thursday said a local conglomerate had met its conditional requirements to buy US insurance giant AIG’s Taiwan unit, closing the $2.16 billion deal.
The Ruen Chen consortium led by Ruentex, one of Taiwan’s biggest conglomerates, will be allowed to acquire 97.57 percent of the shares controlled by AIG in its Taiwan unit Nan Shan Life, Taiwan’s Financial Supervisory Commission said in a statement.
The Commission last month conditionally approved the deal but demanded the buyer meet some other requirements.
Among them was an additional Tw$6 billion ($207.6 million) in a custodial account, bringing the total amount of cash deposited in the account to Tw$30 billion, the Commission said.
As a show of its long-term commitment to the insurer, Ruen Chen also agreed to keep all of its shares in Nan Shan in a trust for 10 years, and placed 70 per cent of holders’ shares in Ruen Chen in a trust for 10 years, it said.
Troubled AIG, short of cash to repay a US government bailout, announced the planned sale of Nan Shan to the consortium in January in its second bid to find a buyer. Ruentex is a sprawling conglomerate with interests in sectors as diverse as construction, textiles and finance.
AIG sold Nan Shan Life to a consortium led by Hong Kong-based Primus Financial Holdings for $2.15 billion in 2009, but the deal was rejected by the Taiwanese regulator last year. Taipei said the Hong Kong group lacked the experience needed to manage an insurer and argued it had failed to provide a long-term management commitment, claims rejected by the consortium.
The rejection dealt a blow to AIG, once the world’s largest insurer, which has been selling assets to pay back US government loans since its rescue from collapse during the 2008 financial crisis.
Taipei, July 14, 2011 (AFP)