quest to buy the US property casualty operations of CGNU Plc, the newly formed top British insurer for $2 billion.

Reuters said on Thursday that White Mountains Insurance Group, US insurers Liberty Mutual Insurance Co. and Citigroup's home and business insurance unit Travelers Property Casualty Corp., were the front runners.

British insurer CGU, which earlier this year merged with Norwich Union in a $11 billion deal to create CGNU, the UK's largest insurer, put its US property-casualty business up for sale in February.

It said it wanted to withdraw from the US market where it had no prospect of competing with the top five insurance companies.

It hired Goldman Sachs to advise on the sale. CGU's Boston-based US operations, collectively ranking as the sixteenth largest US property-casualty insurer, sold more than $4 billion of insurance to businesses and individuals in 1999, making a profit of $285 million.

The business has a book value of about $2 billion, but may not fetch that sale price, sources said on Thursday.

The bidders have completed due diligence, and CGNU is now considering final offers from three potential buyers, sources familiar with the situation said.