Taipei: Second round bidders for AIG’s Taiwan Nan Shan unit have offered less than $1.5 billion—lower than what the US firm had hoped for—raising the possibility that the deal could fail, sources said on Friday.
Primus Financial and Taiwan’s Cathay Financial have submitted bids for AIG’s Taiwan unit Nan Shan Life, offering less than $1.5 billion in the deal, sources close to the companies said on Friday.
Private equity firm Bain Capital had pulled out of its joint bid with Taiwan’s Chinatrust Financial, said another source. With the prices lower than the $2 billion that AIG had hoped for, there was a good chance the US company might not pin down a buy this time.
“Now for certain, three of the bidders we know have offered less than $1.5 billion,” a source close to one of the companies told Reuters. “There might be a 50% chance that AIG will not agree to sell Nan Shan in this round.”
Four consortiums were selected by AIG to take part in the second round of bidding on Friday—the Carlyle Group and Fubon Financial, Bain Capital and Chinatrust Financial, Cathay Financial, and Primus and China Strategic, sources have said.
Carlyle and Fubon remain in the process, according to a separate source close to the matter.
The expensive price tag and growing pension disputes with Nan Shan’s union could once again derail AIG’s plan to sell Nan Shan after an attempted sale was scuppered earlier this year, sources have said.