Mitsui Sumitomo buys Aviva assets

8216;8216;The businesses are not of sufficient size for the strategy of the group going forward,8217;8217; Aviva Executive Director Philip Scott said. 8216;8216;This is an excellent deal. It is a very full price,8217;8217; he added.

The company had reviewed the Asian general insurance businesses specifically since the start of this year and has no plans to sell other non-UK units, Scott said.

The 450 million price is about 2 per cent of Aviva8217;s market value but the businesses account for just 1.1 per cent of group operating profit, the UK insurer said.

Mitsui Sumitomo Insurance, Japan8217;s second-largest non-life insurance firm, has operations in 13 Asian countries besides Japan. It had said it would seek acquisitions to tap growing demand in Asia to offset a sluggish car insurance market at home.

The sale covers Aviva8217;s general insurance business in Singapore, Malaysia, Thailand, the Philippines, Hong Kong and Taiwan.

Aviva will keep and seek to expand its long-term savings operations in Singapore, India, Hong Kong and China, which are run by separate management.

8216;8216;We will be looking to grow those businesses strongly,8217;8217; Scott said.

Mitsui Sumitomo Insurance, which had premium revenue of some 42 billion yen 381.3 million in the last business year in the Asian region excluding Japan, expects to boost that to 72 billion yen, allowing it to narrow the ap with American International Group Inc, Asia8217;s largest insurance group.

Japanese insurers, faced with a saturated domestic market, are stepping up investments in Asian countries such as Thailand and China, where life and non-life markets are expanding fast.

Mitsui Sumitomo Insurance bought stakes in Ayudhya Insurance and unlisted Bangkok Life Assurance Ltd. of Thailand this year.