The American International Group Inc. will sell its holdings in Nanshan Life Insurance Co. Ltd. to Ruen Chen Investment Holding Co. Ltd. for US$2.16 billion in cash, the U.S. firm announced Jan. 12.
Nanshan, Taiwan’s largest life insurer, is 97.57 percent owned by AIG through two subsidiaries. Ruen Chen was formed by Taipei-based Pou Chen and Ruentex groups specifically for the takeover.
“The participants in the consortium enjoy an excellent reputation in Taiwan,” said Robert Benmosche, AIG president and chief executive officer.
“Ruen Chen offers strong operational and funding capabilities, and possesses a clear ability to satisfy the strict criteria that governed AIG’s bid review process.”
AIG put its Nanshan stake on the market following the Great Recession, signing a US$2.15-billion agreement with Hong Kong-based Primus Financial Holdings Ltd. in October 2009. But the Financial Supervisory Commission refused to greenlight the deal, citing concerns over the buyer’s financial standing and commitment to the business.
FSC Minister Chen Yu-chang declined to comment on the planned takeover, reiterating that the regulator will review the deal based on “five conditions.”
“These cover guaranteeing the rights of Nanshan employees and clients, possessing sound financial capabilities to meet future funding needs and demonstrating the ability and commitment to running the business on a long-term basis in Taiwan,” Chen said. “In addition, sources of funding for the purchase will have to comply with current regulations.”
According to AIG, Nanshan serves 4 million policyholders through 4,100 employees and 33,000 agents nationwide.
Nanshan’s financials revealed assets of NT$1.78 trillion (US$59.93 billion) as of the third quarter 2010, with a net value amounting to NT$169 billion. (JSM)
Write to Meg Chang at meg.chang@mail.gio.gov.tw