AIG seeks to sell fund management business

American International Group Inc. (AIG) corporate headquarters in New York, November 10, 2008. REUTERS/Mike Segar

NEW YORK (Reuters) - American International Group Inc AIG.N, the giant insurer bailed out by taxpayers, said on Monday it is seeking buyers for a fund management business.

AIG said it is working with Bank of America Corp BAC.N and Merrill Lynch to sell a fund management business that operates 15 funds with more than $12.4 billion in assets under management as of September 30.

AIG is selling off significant parts of its business to raise funds to repay a $60 billion loan from the U.S. government, part of a $150 billion rescue package.

The fund management business, part of AIG’s global real estate business, is based in New York and operates globally. Funds include equity capital that has been funded or is to be funded partly by AIG Global Real Estate.

AIG was bailed out by taxpayers last year after bad mortgage bets left the insurer in a severe cash crunch and on the verge of bankruptcy.

Reporting by Lilla Zuill; editing by John Wallace