BEIJING - US insurer American International Group has sent senior executives to China to discuss the sale of its Hong Kong-based AIA unit, a top official with China's insurance regulator said on Thursday.
But Chinese firms' potential bids for the embattled US insurer's Asian life insurance unit would be solely a corporate decision, said Li Kemu, vice chairman of the China Insurance Regulatory Commission.
Potential bidders face a Friday deadline to submit bids for the roughly US$20 billion (S$30 billion) unit, American International Assurance Company Ltd. Reuters reported on Tuesday that AIG was willing to give up control of the prized Asian division.
Asked whether China Life or Bank of China might bid for the American insurer's assets, Mr Li said Chinese companies were holding discussions with AIG about a possible deal.
'The discussion is still going on, and we are paying high attention to it,' Mr Li said.
He added that the regulatory commission had a favourable view toward the AIA assets in China and Hong Kong.
'We think AIA is a good company; at least its assets in China and Hong Kong are pretty good,' Li added.
'As a regulator, we care more about risks, or whether AIA's business in China is stable,' Mr Li told reporters.
Plans to sell up to 49 per cent of AIA, considered AIG's crown jewel in Asia, were put in place last fall shortly after the US government saved AIG from bankruptcy with a rescue that has since ballooned to around US$150 billion.
On Wednesday, people close to the matter told Reuters that UK insurer Prudential Plc , Canadian insurer Manulife and Singapore sovereign wealth fund Temasek Holdings were considering offers, although no formal bids had been submitted. Prudential declined to comment. A Hong Kong-based spokesperson for Manulife did not return calls seeking comment. A Temasek spokeswoman said the company did not comment on market speculation.
Hopes for the auction were fading, as economic conditions have worsened since the sale began, causing several major suitors to drop out.
AIA has more than 2 million policies in force according to its website, with branches and affiliates in most major countries throughout Asia outside of Japan. It has 3,800 financial services consultants and 800 staff. -- THOMSON REUTERS
