Sumitomo Life Insurance of Japan has reached an agreement to acquire 40% stake in PT Bank Negara Indonesia's life insurance business for nearly JPY36.2bn ($354m).

Sumitomo Life said in a statement that the partnership with BNI and BNI Life will facilitate the growth of life insurance business in Indonesia while using the expertise in life insurance business which the company has acquired over more than a century.

"It also aims to support long-term enhancement of Sumitomo Life’s policyholder interests by realizing further earnings growth and diversification," the company added.

Under the terms of the acquisition, which is pending regulatory approval, BNI Life Insurance will issue new shares to Osaka-based Sumitomo Life.

BNI Life will also enter into an exclusive long-term bancassurance distribution agreement with BNI to provide a major distribution channel of BNI Life products.

As part of its Asian expansion strategy beyond domestic market, the Japanese private life insurer established PICC Life Insurance Company in China in 2005 and formed a strategic partnership with BaoViet in Vietnam in 2012.

Earlier this year, Sumitomo Life also tried to bid for a 15% stake in Thai Life Insurance Co; although its rival Meiji Yasuda Life Insurance clinched that deal for nearly $700m.

Japanese financial organizations, especially insurers have been looking for assets acquisition in Southeast Asia, where an emerging middle class is driving the growth of the insurance market.

Image: Headquarters of Sumitomo Life Insurance Company in Chuo-ku, Osaka. Photo courtesy of 663highland.