Norwest Corp. is strongly considering the purchase of Avco Financial Corp., a $7.7 billion-asset consumer finance company with a heavy international presence, sources say.

Textron, Avco's parent, said in early June that it was exploring strategic alternatives for the Providence, R.I.-based unit.

Avco, which makes almost half of its subprime consumer and home equity loans outside the United States, has been paired in merger rumors with banks and nonbanks since the announcement. Washington Mutual Inc., GE Capital, Household Inc., and Associates First Capital Corp. have all taken a look at Avco, analysts say.

The unit could fetch $4 billion to $6 billion, according to analysts' estimates.

Norwest would not comment on its acquisition strategy. The Minneapolis- based banking company already has a considerable subprime presence through Norwest Financial Inc., Des Moines, its $9.3 billion consumer finance subsidiary.

Norwest Financial also has a large international presence, including offices or affiliates in Canada, the Caribbean, and Argentina.

The speculation comes on the heels of several deals in consumer finance, including a merger between two of the largest players: Beneficial Corp. and Household International.

Several other conventional lenders could be looking at Avco, analysts say.

"There were a number of banks bidding on Beneficial Corp.," said Mark Alpert, an analyst with BT Alex. Brown. "It would be logical to assume that they would be looking at Avco."

But there are very few financial institutions that could easily absorb Avco's international business, Mr. Alpert said. The company has 1,200 offices in the United States, Canada, Australia, France, India, Ireland, Hong Kong, and Spain.

The company has about $7.7 billion in receivables, nearly half of which have been generated internationally.

Despite clients that do not qualify for bank loans, Avco is not as risky as other subprime lenders, said Ann Maysek, analyst with Bear Stearns. Because Avco does not securitize the majority of its loans, the company does not suffer bottom-line losses when prepayments rise, as many others have this year, she explained.

Also "they have not made missteps overseas, as others have," she noted.

GE Capital Corp. has been named as another front-runner to buy out Avco. Though the GE unit would not comment on Avco, a spokesman said, "We're definitely a global company." GE Capital has offices in 46 countries and thousands of branches, he said.

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