Financial services company Sun Life Financial (NYSE: SLF ) announced in a press release Thursday that it has agreed to establish a partnership with the government of Mayalsia's investment arm, Khazanah Nasional Berhad, to purchase a 98% stake in Malaysian life insurance company CIMB Aviva Assurance Berhad and takaful insurance company CIMB Aviva Takaful Berhad.
The acquisition of the two Malaysian firms for nearly $600 million in total, split between Khazanah and Sun Life, will give both a 49% stake in the combined company. CIMB Group will retain a 2% share. The purchase will give Sun Life a route into selling insurance to CIMB's 8 million customers in Malaysia.
Kevin Strain, president of Sun Life Financial Asia, explained the move in the release, saying, "This transaction is perfectly aligned with our strategy for expanding our footprint in Asia. ... we are investing in a country with one of the most developed economies in the ASEAN region and a growing middle class."
While the transaction will require regulatory approval, it is expected to be completed in 2013's first half.