Timeline: The protracted sale of AIG's Taiwan unit Nan Shan

(Reuters) - Taiwan's regulators rejected American International Group's sale of its unit Nan Shan Life to China Strategic and Hong Kong investment firm Primus Financial some 10 months after it was first agreed.

Concerns over the buyers' backing by political rival mainland China and lack of experience in running an insurance business held up the regulatory review.

Following is a chronology of the sale.

Oct 13, 2009: AIG agrees to sell Nan Shan to China Strategic and Primus for $2.15 billion, with the deal subject to regulatory clearance and a July 12, 2010 deadline for completion.

Nov 17, 2009: Losing bidder Chinatrust Financial, after considering a legal challenge, agrees with China Strategic to take a 30 percent stake in Nan Shan when the deal is approved and to sell a 9.95 percent stake in itself to China Strategic.

Nov 26, 2009: The then head of regulator Financial Supervisory Commission tells Chinatrust to "think carefully" about its deal with China Strategic, warning it might complicate the Nan Shan deal review process.

Jan 12, 2010: Buyer group formally submits documents to Taiwan's Investment Commission, kicking off the regulatory review process.

March 11, 2010; In an unusual move, Taiwan's parliament discusses the deal, highlighting its politically sensitive nature. Protesters outside parliament oppose Chinese involvement and call for their jobs to be protected.

June 5, 2010: China Strategic Chief Executive Raymond Or says he has quit his post on China's top political advisory body to avoid any further delays on the bid.

June 11, 2010: AIG and the buyer group put $325 million in an escrow account for four years to serve as extra capital for Nan Shan, a move seen as another attempt to kickstart the regulatory process and soothe concerns.

June 21, 2010: Buyers extend the deadline of the deal by three months to October 12. China Strategic's Or says the company is doing its best to meet constant demands for information from regulators.

June 25, 2010: Chinatrust's agreement for a stake in Nan Shan expires and China Strategic decides not to pursue it further, saying it has complicated the review process.

July 6, 2010: Chinatrust says it would bid again for Nan Shan if the China Strategic deal is not approved.

July 9, 2010; China Strategic CEO Or announces he will not take a board seat in Nan Shan.

Aug 11, 2010: AIG CEO Robert Benmosche visits Taiwan's financial regulators. No details released.

Aug 30, 2010: A former Taiwanese diplomat who says he wants to "save" Nan Shan from being bought by a Chinese firm claims to be lining up a $2.5 billion bid with Japanese and Middle Eastern money.

(Reporting by Faith Hung; Editing by Jonathan Standing and Muralikumar Anantharaman)