Japan-based Dai-ichi Life Insurance has entered into an agreement to acquire 100% ownership of Tower Australia Group for $1.2bn. Dai-ichi Life brought 28.96% stake in Tower group in 2008.

Through the transaction, Japanese insurer believes that it will be able to support Tower in the next stage of development and also strengthen its efforts in the Australian insurance market.

Upon completion of the transaction, Dai-ichi Life expects that its overseas earnings base will expand significantly and it can make significant progress in diversifying earnings geographically.

The transaction is subject to obtaining approvals of the Japanese and Australian authorities and Tower’s shareholders and is expected to complete in May 2011.