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August 13, 2009

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Home » Business » Finance

AIG in US$70m deal with CCB

AMERICAN International Group, seeking to raise cash to repay about US$180 billion in bail-out loans, has agreed to sell its Hong Kong consumer finance and India-based IT services units.

China Construction Bank (Asia) will buy 100 percent of AIG Finance (Hong Kong) Ltd for US$70 million in cash in a deal that includes repayment of intra-group indebtedness and deposits of about US$557 million, the two companies said yesterday.

Buying AIG Finance would help China Construction Bank, the country's second-biggest lender and the parent of CCB (Asia), to expand in Hong Kong by significantly increasing the customer base as well as market share in the consumer banking market, the Chinese lender said.

Separately, AIG agreed to sell its Indian IT services and solutions arm, AIG Systems Solutions Private Ltd, to local outsourcer MphasiS Ltd for an undisclosed amount.

AIG, once the world's largest insurer, is winding down some units and selling others to cut risky investments to stabilize the company and raise cash after being rescued by the United States government during the credit crisis last year.

The firm on Tuesday said AIG Financial Products had completed the sale of its energy and infrastructure investment assets, for net proceeds of about US$1.9 billion.

AIG has stepped up plans to list its Asian insurance unit, American International Assurance Co (AIA), in Hong Kong after failing to find a buyer for a large stake in it earlier this year.

The company has also sought buyers for its Taiwan unit Nan Shan Life.


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