Allianz, Flowers bid rejected

Allianz SE, Europe’s largest insurer, made an offer to invest in American International Group Inc that was rejected by the US insurer two days before it accepted a government takeover, said two people with knowledge of the bid.

Allianz teamed with JC Flowers & Co, the New York-based private equity firm run by J Christopher Flowers, in an effort to help New York-based AIG stave off a cash crunch, according to the people who declined to be identified because the talks were private.

Sabia Schwarzer, a spokeswoman for Munich-based Allianz, declined to comment. Flowers and Nicholas Ashooh, an AIG spokesman, didn’t return calls seeking comment.

The US Federal Reserve said it offered the loan because of the risk that an AIG failure would threaten the stability of world financial markets.

Edward Liddy, the former Allstate chief executive officer, will replace Robert Willumstad as AIG’s CEO, said another person who is familiar with that situation. All three of the people spoke on condition of anonymity.