AIG has approached some of the world’s biggest investors over the sale of a significant stake in AIA, the US insurer’s Asian unit, drawing a strong interest from China, a report said Thursday.
The response has prompted AIG to consider offering up to 30 percent to institutional investors and wealthy tycoons, as opposed to offering minor stakes in a planned initial public offering, said the Financial Times. Chinese insurance companies and some of China’s largest banks are said to be looking at both taking stakes and financing others, said the FT, citing people familiar with the matter.
But it is not clear whether Chinese regulators would approve, said the report, adding that the move could go against insurance industry rules. AIA reportedly plans to list more than half its equity in Hong Kong by October or November with the goal of raising as much as 23 billion US dollars (17.8 billion euros, 14.6 billion pounds).
Thursday’s report was the latest indication of Chinese interest in AIA. Last month, Hong Kong’s South China Morning Post newspaper reported that at least four consortia made up of private Chinese investors had approached AIG about acquiring its Asian business. The FT said Thursday that sovereign wealth funds had also expressed an interest in AIA, including the Singapore funds GIC and Temasek, and funds in Abu Dhabi, Kuwait and Qatar.
AIG is seeking to repay billions of dollars in American government bailouts. The US insurer was forced to look again at the option of the Hong Kong listing for AIA to raise fresh funds following the collapse in June of Prudential’s 35.5-billion-dollar takeover bid for the Asian unit. AIG has previously said it would “proceed as soon as practicable” with the listing plan.
London, Aug 12, 2010 (AFP)