HONG KONG (Reuters) – AIA Group Ltd has agreed to buy a 24.99% equity stake in China Post Life Insurance Co., Ltd., for 12 billion yuan ($1.86 billion), the Asia-focused insurer said in a stock exchange filing on Tuesday.
AIA said its wholly owned Chinese life insurance business would remain independent of this investment which would increase its exposure to the Chinese life insurance market.
China Post Life is a subsidiary of China’s postal service operator, China Post Group Co. Ltd. and targets Chinese mass market consumers selling its products via banks.
Its value of new business (VONB), which measures expected profits from new premiums and is an important gauge of future growth, was 1.866 billion yuan ($289.11 million) for 2020.
AIA’s China operations, which targets middle-class and affluent customers had a VNOB of $968 million for 2020, and accounted for 32% of the AIA Group’s total.
($1 = 6.4544 Chinese yuan renminbi)
(Reporting by Alun John, editing by Louise Heavens)
