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U.S. insurer American International Group Inc (AIG) has decided to sell 90 percent of its stake in ILFC, the world’s largest aircraft leading business, to a Chinese consortium –comprising New China Trust, which is one-fifth owned by Barclays Plc, China Aviation Industrial Fund and P3 Investments Ltd -- for a total consideration of $4.8 billion. An arm of Industrial and Commercial Bank of China will join the consortium once the deal has regulatory approval.

This deal is principally governed by burgeoning demand for aircraft leasing in China and AIG’s own strategy to reduce its assets in Asia.

“Upon completion, the transaction will have a positive impact on AIG`s liquidity and credit profile and will enable us to continue to focus on our core insurance businesses,” AIG CEO Robert Benmosche said in a statement.

The transaction would also give China access to a global network of some 200 airlines in 80 countries. ILFC already operates 180 aircraft in China.

"We believe there are not enough aircraft on order in China at the moment. It will help Chinese airlines get more aircraft," said Paul Sheridan, head of Asia at aviation consultancy firm Ascend Advisor.

For long, China has been a dominant aircraft buyer, purchasing passenger planes from both EADS-owned Airbus and US major Boeing. However, it had been paying a premium for the planes. Now, with this deal China will gain access to cheaper, more efficient aircraft.

The stake sale will need the approval of the U.S. Committee on Foreign Investment, or CFIUS -- which vets foreign deals for security concerns. But since ILDC’s portfolio is not heavily invested in the US, there are likely to be few concerns with regard to the deal with China.

ILFC, founded by Steven Udvar-Hazy, was sold to AIG in 1990. The firm has bought more than 1,500 passenger jets from Boeing and Airbus, and currently has a portfolio of more than 1,000 owned or managed aircraft. Reports say the firm has on order 239 new fuel-efficient planes, including Boeing 787s and Airbus A320neos, and has the rights to buy an additional 50 such aircraft.