* UOB’s sale of life insurance unit to be completed by Jan 31
* Prudential also enters 12-yr bancassurance deal with UOB
* Prudential sees growth in Singapore, Indonesia, Thailand
* UOB shares up 1.4 percent, Prudential up 0.2 percent (Recasts with official confirmation of deal; adds analyst quote)
SINGAPORE, Jan 6 (Reuters) - Britain’s biggest insurer Prudential (PRU.L) is buying the life insurance unit of Singapore’s third-biggest lender UOB (UOBH.SI) for S$428 million ($307 million) to beef up its presence in fast-growing Asia.
Prudential also entered into a 12-year partnership with United Overseas Bank to distribute insurance products through UOB’s branches in Singapore, Thailand and Indonesia, it said in a statement.
Prudential will be competing for greater market share in Southeast Asia against AIA, a unit of bailed out U.S. insurance firm AIG (AIG.N), and Singapore bank OCBC’s (OCBC.SI) insurance unit Great Eastern (GELA.SI).
The deal would help Prudential meet its aim of growing in Southeast Asia, Kevin Ryan, an analyst at ING in London said.
“The big difficulty for them in all of these areas, and the thing that is hampering their growth in their targeted countries is getting people on the ground selling products. So having these bank branches looks like good news,” Ryan said, adding that the pricing did not appear to be excessive.
UK’s Prudential operates in 13 Asian markets where it has more than 11 million life customers. Asia, which accounted for 44 percent of Prudential’s profits in 2008, is also seen as the engine of the group’s future growth.
“The bancassurance partnership offers us significant new profitable growth opportunities in Singapore and Indonesia, and substantially increases our scale in Thailand, a key market in the region,” Tidjane Thiam, chief executive of Prudential Plc, said in a statement.
UOB, owned by the family of Singapore banking and property tycoon Wee Cho Yaw, had been looking to sell its life insurance business for some time because it was small and not considered a core business, analysts said.
HSBC (HSBA.L) advised UOB on the deal, UOB said.
UOB shares rose 1.4 percent after it lifted a trading suspension following the announcement of the deal, extending gains from the morning session. The benchmark Straits Times Index .STI was up 0.27 percent at 0405 GMT.
Prudential shares were up 0.2 percent in early London trade. ($1=1.396 Singapore Dollar) (Reporting by Saeed Azhar and Kevin Lim; Additional reporting by Clara Ferreira-Marques in London; Editing by Muralikumar Anantharaman)