The Chinatrust Financial Holding led group, comprising Bain Capital and Oaktree Capital Management, is mulling to opt out of the bidding process for AIG’s Taiwan Unit – Nan Shan Life Insurance – reported Bloomberg.
It has been reported that the buy out funds are unable to assess the exact amount of capital the Taiwan unit wants to sell for about $2 billion, and are of the opinion that it would be difficult for the unit to return to profit over the next three years.
Calvin Choi, associate director in the corporate finance unit at PricewaterhouseCoopers in Hong Kong, said: The historical problems of Nan Shan might take years to digest and this poses lots of uncertainty on the timing of an exit. It won’t be a surprise to see more potential investors drop out, and the ultimate transaction value will definitely be at a deep discount to AIG’s expectation, reported the Daily Mail.
Since September 2008, when it had received lifeline from the government, AIG has entered into agreements to dispose assets worth $9.3 billion.
