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Taiwan hopes Nan Shan application to be resubmitted

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Taiwan’s top financial regulator told lawmakers Wednesday he hopes the consortium that won the bidding for American International Group Inc.’s (AIG) Taiwan unit will resubmit its application to buy the firm soon, after the original application was kicked back in November with a request for more documents.

The head of one of the companies in the winning consortium told Dow Jones Newswires the consortium hoped to resubmit the application before the end of the year.chi

The consortium comprising Hong Kong’s China Strategic Holdings Ltd. (0235.HK) and investment company Primus Financial Holdings Ltd. successfully bid US$2.15 billion for Nan Shan Life Insurance Co. in October, stirring controversy in Taiwan on concerns the firms in the consortium were backed by mainland China money.

Despite warming official relations between China and Taiwan, the island maintains restrictions on investments in its financial services firms by companies backed by mainland cash.

Both Primus and China Strategic have said none of their investors holds a Chinese passport.

In a legislative session Wednesday, Sean Chen, chairman of the Financial Supervisory Commission, said: “We still haven’t received the application.”

Raymond Or, China Strategic’s chief executive, told Dow Jones Newswires the consortium is still preparing the information required by the regulator.

“We are doing our best to collect all the information, which is a lot,” he said.

Wing Fai Ng, a Primus co-chief executive, wasn’t immediately available to comment.

Primus’s other co-chief executive, Robert Morse, said earlier this month the consortium had been spending a lot of time with Nan Shan’s management, employees and agents to assure them about their sources of funding and their intention to make a long-term investment in Taiwan.

Another factor complicating the acquisition’s approval is the consortium’s agreement to sell a 30% stake in Nan Shan Life to Chinatrust Financial Holding Co. (2891.TW) in exchange for a 9.95% stake in Chinatrust.

That deal was announced just weeks after Primus and China Strategic won the bidding for Nan Shan Life, prompting a rebuke from the Taiwan regulator because the consortium’s acquisition of the life insurer had yet to obtain its approval. The regulator said the deal with Chinatrust also raised questions about the consortium’s long-term commitment to Nan Shan Life.