August 31, 2010 (Chinavestor) American International Group's (NYSE: AIG) planned sale of its Taiwan unit to China Strategic (HKG:0235) was rejected by Taiwanese regulators due to the latter company's ties to mainland China. AIG (NYSE:AIG) was hoping to sell the Nan Shan business for $2.2 billion. The company announced that it would part with the business last October as part of its plans to repay loans from the U.S. government.
Taiwan's economics ministry said the deal did not meet its standards for investments from its political rival China. China Strategic (HKG:0235) is a battery maker and has little experience in the insurance, another point cited by the economics ministry as reason for rejecting the deal.
China Strategic (HKG:0235) has a month to appeal the decision. AIG (NYSE:AIG) will find Taiwanese bank Chinatrust Financial (TPE:2891) waiting in the wings to bid for Nan Shan, Reuters reported. The news agency also reported that a retired Taiwanese diplomat is linig up a bid for Nan Shan from investors in Japan and Qatar.