DOW JONES NEWSWIRES
(Adds acquisition deals made by Japanese insurers in the fourth paragraph)
By Atsuko Fukase
Of DOW JONES NEWSWIRES
TOKYO (Dow Jones)--Mitsui Sumitomo Insurance Co. will buy a 50% stake in the life insurance unit of Indonesia's conglomerate Sinar Mas, as parts of its efforts to ramp up business in Asia, a person familiar with the matter said Friday.
Japan's second largest life insurer by premium revenue will likely spend about Y70 billion on the deal and is expected to reach an agreement as early as Monday, the person said.
The deal would be one of the biggest acquisitions made by a Japanese nonlife insurer targeting emerging markets.
Mitsui Sumitomo's move is the latest in a string of Japanese life and nonlife insurers' overseas shopping spree.
In the recent years, major insurance companies have been aggressively looking for an acquisition or investment target for further growth as Japan's population is shrinking and its life-insurance industry is seen as saturated.
Japan's largest life insurer, Nippon Life Insurance Co. last month agreed to buy about a 26% stake in India's Relianace Life. Dai-ichi Life Insurance Co. (8750.TO) in December agreed to buy Tower Australia Group Ltd. for about Y99.6 billion, making the insurer a wholly owned unit.
Nonlife insurers are even more active in overseas acquisition. Mitsui Sumitomo Insurance bought a 30% stake in Hong Leong Assurance Bhd., the sixth-largest life insurer in Malaysia. Smaller rival Sompo Japan Insurance Inc. also bought a 94% stake in midsize Turkish firm Fiba Sigorta Anonim Sirketi for Y28.1 billion last year.
-By Atsuko Fukase, Dow Jones Newswires; 813-6269-2792; atsuko.fukase@dowjones.com
Copyright (c) 2011 Dow Jones & Company, Inc.
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