American International Group Inc's plans to sell its broker-dealer business, AIG Advisor Group, are facing hurdles, the New York Post said.

Division CEO Arthur Tambaro in April said that AIG was in final discussions with a potential buyer, the paper said. But two months later, no deal has been struck.

Two sources told the paper that mutual-fund company Fidelity Investments considered providing financing for an unnamed bidder, but backed out. Fidelity declined to comment to the paper.

The paper said the lack of a deal for AIG Advisor Group has already led to some departures among its staff, adding there is speculation that more than half of the company's employees may head for the exit if a deal is not struck by year-end.

AIG Advisors, which includes Royal Alliance Associates of New York, generated $1.3 billion in 2007 revenue, the paper said.

AIG could not be immediately reached for comment by Reuters.