ILFC-CREDIT-LINE-UPDA

American International Group Inc.’s aircraft-leasing unit, which has been shut off from its usual sources of funding, will get a $5-billion line of credit from the Federal Reserve to help prepare it for sale, according to three people with knowledge of the matter.

The Fed, which along with the U.S. Treasury has committed $182.5 billion to the bailout of AIG since September, is working to help the insurer sell divisions to repay some of its loans. The credit facility may reassure potential buyers of Los Angeles-based International Lease Finance Corp., the largest customer of Airbus and Boeing Co., that its business is sustainable outside of the AIG umbrella, the people said.

International Lease Finance, run by founder Steven Udvar-Hazy, has attracted interest from at least three rival groups of investors, including private equity firms, one source said. The company’s book value, or assets minus liabilities, was $7.6 billion as of Dec. 31.

Paula Reynolds, AIG’s restructuring chief, has said that the Fed agreed to offer “some form of backstop financing” to “facilitate that sale and carry the new owners with some secured financing over at least an interim basis.”