UK-based insurance company Aviva has signed an agreement to divest its entire 47% shareholding in South Korean business Woori Aviva Life Insurance (WALI) to NongHyup Financial Group (NHFG).
Aviva did not reveal the cost of the transaction; although, it said that the sale of stake will boost its economic capital surplus by £200m ($335m).
Majority owned by Woori Financial Holdings Company, WALI has also agreed to sell its stake to NHFG as part of this transaction.
Aviva said that the transaction is consistent with its plan to concentrate on markets where it has a sustainable competitive advantage to maximize return on capital.
The transaction will increase economic capital surplus by £0.2bn, recognizing the reduced exposure to interest rate and credit risk.
The sale of WALI, which is subject to regulatory approval, is part of a broader privatization of Woori by the South Korean Government.
Aviva Asia chief executive Khor Hock Seng said, "Aviva has a strong presence in China and South East Asia, which are key future cash generators for the group. This deal provides further focus to our Asian businesses, which increased value of new business by 65% in 2013."
Formed in 2008 by Aviva and Woori Finance Holdings Company, Woori Aviva Life Insurance distributes life insurance products through Woori Financial Holdings distribution network of over 1,300 branches.