AIG Faces Hurdles in Sale of Taiwan Unit

NEW YORK (TheStreet) -- The sale of American International Group's(AIG)Taiwan unit is seeing its share of problems.

Chinatrust, Taiwan's top credit card insurer, is the latest bidder to likely pull out of the rapidly thinning field in the race for Nan Shan Life, Reuters reported.

Chinatrust's partner in the pending deal, Bain Capital, has expressed concerns with going forward, Reuters said, citing an unnamed source.

Earlier in the week, Bloomberg reported that Morgan Stanley's(MS) private equity fund also ducked out of Chinatrust's group, citing a conflict of interest.

Other bids on the unit include: a joint bid from Caryle Group and Fubon Financial; a joint bid from Primus Financial and China Strategic; and a solo bid from Cathay Financial.

Binding offers are due on Aug. 28.

Chinatrust's rumored pullout is just one of the many roadblocks in AIG's attempt to selloff the company, a deal that was expected to fetch about $2 billion.

Taiwan's financial regulator said on Tuesday that Nan Shan Life must first settle a pay dispute with employees before a new owner can take over, Reuters reported.

Insurance agents at the unit also are in talks to receive $420 million in pension funds that they say are owed to them.

-- Reported by Jeanine Poggi in New York.

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