Sun Life, Khazanah Said to Near CIMB Aviva Assurance Acquisition

Sun Life Financial Inc. (SLF) and Khazanah Nasional Bhd. are in final talks to buy the Malaysian insurance joint venture of CIMB (CIMB) Group Holdings Bhd. and Aviva (AV/) Plc, six people with knowledge of the matter said.

The sale may value CIMB Aviva Assurance at more than 1 billion ringgit ($329 million), two people said, asking not to be identified as the information is private. CIMB, Malaysia’s second-largest lender, owns 51 percent of the venture and London-based Aviva holds the rest.

Final details of the deal, including the price and the structure, are still being discussed and CIMB may keep a small stake in the joint venture, the people said. Khazanah is Malaysia’s state investment company.

Spokesmen at CIMB, Khazanah, Aviva and Sun Life declined to comment on the sale process. Prudential Plc and Manulife Financial Corp. (MFC) had also made offers to buy the business from CIMB and Aviva, people with knowledge of the bids said in November.

CIMB Aviva may fetch a valuation similar to the 2.2 times book value that AIA Group Ltd. paid for ING Groep NV’s Malaysian insurance business in a recent deal, two of the people said. AIA agreed to pay 1.3 billion euros ($1.7 billion) for the unit in October, describing Malaysia as one of Southeast Asia’s fastest- growing life assurance markets.

CIMB Aviva reported profit of 49.7 million ringgit in the six months through June, according to its website.

Khazanah is the largest shareholder in Kuala Lumpur-based CIMB, with 29.9 percent of the bank, data compiled by Bloomberg show. Sun Life and CIMB operate an insurance joint venture in Indonesia that was started in 2009.

To contact the reporters on this story: Joyce Koh in Singapore at jkoh38@bloomberg.net; Elffie Chew in Kuala Lumpur at echew16@bloomberg.net

To contact the editor responsible for this story: Philip Lagerkranser at lagerkranser@bloomberg.net