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PARIS (Reuters) - AXA (AXAF.PA) said it agreed to buy 50 percent of Chinese property and casualty insurance company Tian Ping for 485 million euros ($631 million) to strengthen its position in high-growth markets.
AXA, which earlier this month sold a portfolio of old life insurance policies in the United States for $1.1 billion, has been expanding into emerging markets as developed markets remain sluggish in the wake of the global financial crisis.
AXA and Tian Ping's current shareholders will jointly control Tian Ping, while AXA's existing Chinese property and casualty operations are expected to be integrated within the new joint venture, AXA said on Wednesday.
AXA said the takeover would make it China's largest foreign property and casualty insurer and strengthen its position as the biggest P&C insurer in Asia excluding Japan.
"This acquisition provides AXA with unique direct distribution capabilities in the fast-growing P&C insurance market in China, thanks to Tian Ping's extensive knowledge of the domestic market," AXA Chief Executive Henri de Castries said in a statement.
AXA shares ticked up 1.2 percent in early trading, slightly outperforming the European sector .SXIP, which was 0.5 percent higher.
Under the terms of the agreement, which is subject to regulatory approval, AXA will buy 33 percent of Tian Ping from its current shareholders for 1.9 billion yuan ($307 million) and also subscribe to a 2.0 billion yuan capital hike aimed at funding future growth, AXA said.
Editing by Catherine Bremer and James Regan