Asian insurer AIA Group said this morning it had acquired the bulk of Aviva’s Sri Lanka operation, in a deal worth $109m (£67.3m).
AIA, formerly part of US insurance giant AIG, has agreed to buy a 92.3 per cent stake in Aviva NDB. The transaction includes a 20-year bancassurance agreement with Sri Lanka’s National Development Bank.
It comes as AIA is seen as the frontrunner to buy some of ING's Southeast Asian operations and as several other global insurers are stepping up their presence in the region to tap rapid growth in insurance premiums.
For Aviva, the Sri Lankan exit is part of a wider retreat from sub-scale Asian markets as it confronts Eurozone exposure, a plunging share price and shakeup of its top management. It has also put its South Korean and Malaysian businesses up for sale.
Sri Lanka is “compelling”, because of its strong growth prospects and low levels of insurance penetration, AIA chief executive Mark Tucker said in a statement this morning.
City A.M. Reporter