British insurer Prudential PLC (PRU.L) is in advanced talks with Malaysia's No.2 pension fund to sell a 30-percent stake, valued at about $435 million, in its Malaysian unit to comply with new foreign ownership rules, people familiar with the matter said.
Foreign insurers are scrambling to trim their stakes in their local units to 30 percent to abide by a directive from Malaysia's central bank, under an initiative to lift domestic participation in the industry.
Prudential Assurance Malaysia Berhad is a wholly-owned life insurance unit of Britain's largest insurer by assets. It is one of the leading foreign insurers in the Southeast Asian country.
The British insurer's talks with retirement fund Kumpulan Wang Persaraan (KWAP) are not exclusive and details of a possible deal could be finalised as early as this month, said the people who declined to be named as the talks are not public.
KWAP CEO Wan Kamaruzaman Wan Ahmad told Reuters that the fund had submitted its offer for the Prudential unit's stake, but declined to give details. Prudential did not comment on the talks, but said it was committed to its local business.
There is no certainty that Prudential's talks with KWAP will result in a deal, and the British insurer could also weigh a possible listing on the Malaysian bourse to divest the stake, the people said.
(This version was refiled to fix CEO name in paragraph five)