Insurance Australia Group Limited (ASX:IAG) will spend $100 million for a strategic stake in a general insurer in China to expand its footprint in the region.
The Australian insurance company has inked a deal for a 20 per cent interest in Bohai Property Insurance.
Under Chinese regulations, the 20 per cent stake is the maximum holding allowed for a single foreign investor in a general insurance company.
IAG says the acquisition puts the company’s Asia division well on track to meet its target of contributing 10 per cent of IAG’s gross written premium by 2016.
IAG reported a net profit of $205 million in the second half of 2010.
