Transamerica Corp.'s decision to sell its $3.6 billion-asset consumer finance company could either strengthen an already strong player, such as Norwest Corp., or bulk up a banking company that's a smaller player, observers said.

Minneapolis-based Norwest, which earned $264 million on its consumer finance business last year, would not comment on whether it intends to bid for the Transamerica unit. Transamerica announced its plans to sell the unit last week.

"We're in the broad industry of financial services, and that means not only banking but consumer finance and mortgages," said Norwest spokesman Larry Haeg. "We're always exploring a variety of businesses that would benefit our shareholders."

Other banking companies have indicated they want to be bigger in the consumer finance business, including KeyCorp and Banc One Corp. Meanwhile, a number of nonbank companies, including Household International Inc., are also likely to be interested. But none would comment on whether they had plans to bid on the Transamerica subsidiary.

Transamerica officials said the portfolio for sale, which is almost entirely subprime home equity loans, has a book value of $450 million, but the company expects more for the operation because it includes 420 offices in 44 states. Separately, the company is selling or liquidating $550 million of mostly delinquent loans and foreclosed properties.

Analysts were unsure how much the package would fetch.

The larger portfolio contains "really clean loans," and that's why the company hopes to sell them at a premium, said Transamerica spokesman Richard J. Olsen. Goldman, Sachs & Co. has been retained to market the finance business, which Transamerica hopes to sell by the end of the second quarter.

Norwest Financial Inc., with $7.4 billion of receivables, already has 896 consumer finance offices in 48 states. It also has 140 offices in Canada and a further 140 overseas offices, mostly in Latin America.

Some analysts noted that Norwest doesn't necessarily need to do a large acquisition to be competitive, so pricing could be an issue.

They'd be a possible bidder for the Transamerica unit, said George M. Salem, an analyst at Gerard Klauer Mattison. "I'd just want to see how much overlap there is. Then there's the types of loans. There are consumer loans, and there are consumer loans" that aren't performing, he added.

The $50 billion-asset Transamerica is one of several companies to put its consumer finance business up for sale. This month, BankAmerica Corp. said it plans to sell most of its Security Pacific Financial Services subsidiary, another subprime home equity lender. This unit has $1.4 billion of loans and 300 offices in 33 states. BankAmerica said it would redeploy proceeds of the sale to other businesses. Transamerica said it would use the proceeds to pay down debt and buy back stock.

In January, Fleet Financial Group announced plans to sell its subprime mortgage unit, Option One, which services about $2 billion of loans.

The problem for potential acquirers of these businesses, Mr. Salem said, is that prices for consumer finance companies have been high. Moreover, these businesses are for sale because they've been money losers. That means more work for the acquirer, he added. u

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