American International Group Inc. has agreed to sell its 97.6 percent stake in Taiwan's third-biggest insurer to the Ruen Chen consortium for $2.16 billion, five months after regulators nixed AIG's first attempt to sell the business.

The deal announced Wednesday is part of AIG's efforts to raise funds to exit government ownership after it received the largest U.S. bailout — $182 billion — of any financial firm in the wake of the 2008 financial crisis.

Taiwan's Ruen Chen is dominated by the Ruentex Group, a construction and wholesale products concern, with a minority share held by shoe manufacturer Pou Chen.

AIG's sale of Nan Shan Life Insurance Co. will have to pass muster with Taiwan's Financial Supervisory Commission, an independent government body that is far from certain to give approval.

In August 2010 the FSC turned down AIG's effort to sell Nan Shan for $2.15 billion to Hong Kong-based Primus Financial Holdings, because of fears that Primus might be a front for mainland Chinese interests. Taiwan law prohibits Chinese investment in the island's financial sector.

"Ruen Chen has demonstrated that it is able and willing to invest in Nan Shan's future, and that it will protect and serve the best interests of Nan Shan's policyholders, employees and agents," AIG President and Chief Executive Officer Robert Benmosche said in a statement.

Ruentex counts among its allies powerful Taiwanese politicians including legislative speaker Wang Jin-pyng but FSC approval of this latest deal is not guaranteed.

For one, Ruentex has a history of turning its acquisitions over fairly rapidly while the FSC would like the Nan Shan purchaser to hold the company for at least 10 to 15 years.

For another, as a nonfinancial sector company, Ruentex looks set to borrow significant sums from local banks rather than using its own money as the FSC would prefer.

Ruentex chairman Samuel Yin is also believed to have strong Chinese connections, just as was the case with Primus.

Ruentex tried to allay some of these concerns.

"We intend to be a long-term stakeholder in Nan Shan, and we want to ensure the sustainability of its operations," the company said in a statement.

Nan Shan is the third biggest insurer in Taiwan by market share. It owns about four million insurance contracts on an island with a population of 23 million.

In a series of noisy demonstrations last year many of its approximately 40,000 employees expressed concern that they could lose their jobs if the company were sold.