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![AIA acquires almost 25% stake in China Post Life Insurance](https://marketing-interactive-assets.b-cdn.net/images/hk/content-images/aia_building.jpg?auto_optimize=medium)
AIA acquires almost 25% stake in China Post Life Insurance
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AIA has plans to acquire a 24.99% stake for RMB12 billion (US$1.86 billion) in the life insurance arm of the China Post Group as it hopes to expand its presence in China.
In a statement, AIA Group said it has agreed to invest in China Post Life Insurance through its wholly-owned subsidiary AIA Company. The investment will be financed on an all-cash basis from internal resources.
After the acquisition, the group’s operation of AIA Life Insurance Company (AIA China), its wholly-owned life insurer in China, will remain entirely independent of this investment. AIA China will continue its focus on high-quality growth including geographical expansion. The company aims to target the middle-class and affluent customer segments in China and provide them high-quality protection and long-term savings products.
The report also cited AIA’s group chief executive and president Lee Yuan Siong that the Chinese insurance market is already the second-largest in the world with immense long-term growth opportunities, while the investment would enable AIA to benefit from additional distribution channels and customer segments.
China Post Life is a subsidiary of China Post Group is a bank-affiliated life insurer focused on bringing financial protection to the mass and emerging mass-affluent market in China. Through its distribution partnership with Postal Savings Bank of China (PSBC), it has access to the largest retail financial distribution network of around 40,000 financial outlets nationwide and more than 600 million retail customers. China Post Life currently distributes in 21 provinces, covering 80% of the PSBC network.
The company also said the latest investment in China Post Life will increase its exposure to the Chinese life insurance market and the potential from distribution channels and customer segments that are complementary to its existing strategy in China.
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