(Reuters) – American International Group Inc (AIG.N) is in exclusive talks with a bidding group including Franklin Resources Inc (BEN.N) and Crestview Partners LP for its asset management business, sources familiar with the matter said on Wednesday.
The asset management business being sold rests within AIG Investments. If a deal is reached, Franklin, which manages the popular Franklin and Templeton mutual funds, would have a minority stake in the AIG business, the sources said.
The group is being advised by former Franklin co-President Charles Johnson, who founded alternative asset management firm Tano Capital, they said. It plans to keep AIG Investments Chief Executive Win Neuger as the head of unit, they added.
AIG and Crestview declined to comment, while Franklin could not be reached immediately. The sources are anonymous because the auction is private.
Private equity firm Crestview Partners has $4 billion under management and pursues $100 million to $300 million investments with a focus on asset management, media, healthcare and financial services, according to its Website.
The AIG asset management business had drawn interest from both private equity and strategic buyers, sources have told Reuters previously. Initial bids for the unit had come in around $500 million. [ID:nN24436583]
The sale is part of a larger divestiture program by AIG, as it looks to sell assets to pay back the U.S. government.
The government has committed some $180 billion in AIG’s rescue, including about $85 billion in loans that the insurer is trying to repay with these divestitures.
AIG’s shares were off 3 cents at $1.78, while Franklin was off $1.59 to $61.60 during late trading on the New York Stock Exchange.