Hong Kong-based Primus Financial Holdings on Wednesday defended its bid to buy the Taiwan unit of ailing US insurance giant American International Group.
The move for Nan Shan Life came a day after the application by Primus Financial Holdings and its partner China Strategic Holdings was rejected by Taiwan’s Investment Commission. Taiwan authorities said they feared the Hong Kong consortium was short of experience to manage an insurer and charged that it had failed to provide a long-term management commitment.
“The allegations and concerns are unacceptable,” Primus Financial Holdings said in a statement. It said the consortium had presented to the Financial Supervisory Commission, regulators that oversee Taiwan’s insurance industry, documents that had been verified legally.
When asked by AFP whether Primus would appeal, a source close to the firm said “the consortium is working towards the direction”. The Hong Kong bidder is allowed to file an appeal within 30 days. Rejection of the bid came as a blow to AIG, once the worlds largest insurer, which has been selling assets to pay back US government loans since its rescue from collapse during the 2008 financial crisis.
AIG said it was “disappointed by the Investment Commission’s decision concerning the sale of Nan Shan… AIG is conferring with the Primus Nan Shan consortium as to appealing this decision.” The Hong Kong consortium agreed to acquire Nan Shan Life from AIG for 2.15 billion US dollars in October last year, but the deal has been in limbo since November when China Strategic announced a plan to sell a 30 percent stake in Nan Shan to Taipei-based Chinatrust Financial Holding Co.
Rumors also surfaced late last year that Chinese capital was involved in the deal, which the consortium has repeatedly denied.
Fan Liang-tung, executive secretary of the Investment Commission, also made it clear that the decision had nothing to do with the Chinese capital concerns.
Taipei, Sept 1, 2010 (AFP)
