Taiwan-based Cathay Life Insurance has agreed to buy a 40% stake in Indonesia’s Bank Mayapada Internasional for IDR 3.52tn ($278m).
The move is part of Cathay Life’s strategy to expand footprint in the Association of Southeast Asian Nation (ASEAN) economic bloc.
The acquisition will be completed in two stages, with Cathay acquiring 24.9% stake in Bank Mayapada in the first stage, and the remaining 15.1% stake in stage two.
The first stage of the acquisition is scheduled to be completed in the first quarter of this year.
Following the completion of the deal, Cathay Life will become the second largest shareholder in the bank after Mayapada Group.
Moreover, Cathay Life could bag two board seats out of Bank Mayapada’s six-member board of directors, and one of the bank’s five supervisor seats.
The deal is yet to secure regulatory approvals in Taiwan and Indonesia.
The 1989-founded Bank Mayapada managed total assets worth $2.5bn as of 30 September 2014, and operated 175 branches and offices throughout Indonesia.