American International Group

(AIG) - Get Report

plans to spin off its Asian life insurance unit in a $5 billion to $10 billion Hong Kong initial public offering in the first quarter of next year,

Dow Jones Newswires

reports, citing a person familiar with the situation.

The insurer will likely sell one-quarter to one-third of American International Assurance and maintain majority control of the operation, the person added.

AIG plans to soon send out requests for proposal to investment banks for which it will select bankers for the deal,

Dow Jones Newswires

reports. RFPs generally signal the start of the IPO process.

AIG couldn't immediately be reached for comment.

The insurer earlier this year dropped a plan to sell as much as a 49% stake in the Asian life insurance arm because of a lack of substantial bids, the report notes.

Manulife Financial

(MFC) - Get Report

,

Prudential PLC

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and Singapore's sovereign wealth fund Temasek were close to bidding for the assets, which bankers had valued at between $20 billion to $30 billion back then,

Dow Jones Newswires

reports.

AIG CEO Edward Liddy told Congress Wednesday the insurance company is making progress toward repaying U.S. taxpayers by selling many of its foreign assets.

AIG has received $182.5 billion in financial support from the government since September.