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Buyers circle AIG’s non-core assets

Potential buyers are eyeing off AIG business units after the US insurer announced the sale of non-core assets to focus on its international general insurance business.

Various news reports suggest that AIG consumer finance operations in Thailand will join Japanese life insurance units and AIG operations in India to be among the first units likely to go under the hammer.

US firm Hartford Steam Boiler Inspection and Insurance is also said to be on the block.

Allianz and Munich Re have expressed interest in acquiring AIG assets.

AIG plans to retain its global general insurance businesses and also wants to retain a continuing ownership interest in its foreign life insurance operations.

US Government-appointed AIG Chairman and CEO Edward Liddy says the insurer aims to generate enough capital to repay the outstanding balance of its Federal Reserve Bank loan.

AIG was criticised at a US congressional hearing last week for hosting an event for intermediaries at a spa retreat that cost $US400,000 ($590,000). The event came less than a week after the Government bailout.

In a letter to US Treasury Secretary Henry Paulson, Mr Liddy defended the expenditure stating that the retreat was planned well in advance of the government intervention and “consisted almost entirely of independent insurance agents”.