Canada-based Sun Life Financial and Malaysian investor Khazanah Nasional are planning to acquire life insurer CIMB Aviva in Malaysia, in a deal valued at MYR1.8bn ($596m).

Both firms will jointly purchase 98% of the life insurer in order to boost their footprint in Southeast Asia’s growing financial services markets, as reported by the Wall Street Journal.

Further terms of the transaction have not been disclosed, however it is expected that the deal will be announced next week.

CIMB Aviva Malaysia is a joint venture (JV) by UK-based Aviva, which owns 49% stake and the Malaysian bank CIMB Group manages 51% stake in the JV.

As per the Malaysian insurance regulation, a foreign firm can only acquire 70% in an insurance company; hence Sun Life has teamed up with Khazanah to complete the deal.

Both firms emerged as the successful bidder vying against Canada-based Manulife Financial and UK-based Prudential.

Headquartered in Toronto, Sun Life already manages operations in Hong Kong, China, India, the Philippines, Vietnam and Indonesia.

Aviva, which founded the JV with CIMB in 2007, is disposing of the venture in order to gather additional capital ahead of new capital requirements for European insurers.