The ongoing drive by Japanese insurers to expand outside their home markets has seen Mitsui Sumitomo Insurance agree to buy a Singapore-based non-life insurer.
Mitsui Sumitomo is to buy Singapore-based First Capital Insurance from Canada's Fairfax Financial Holdings for $1.6 billion.
The deal is subject to regulatory approvals and is expected to close in late 2017 or early next year.
Stagnant Domestic Market
Mitsui Sumitomo Insurance, the core firm of Mitsui Sumitomo Insurance, Aioi Nissay Dowa Insurance (MS&AD Insurance Group Holdings), and Fairfax will also explore a broad global partnership in various areas, including reinsurance relationships, Fairfax said in a statement.
Japanese insurers have been scouring Asia and beyond for deals as their own population ages and declines.
The number of people in Japan is predicted to tumble from just over 127 million in 2015 to 88 million in 2065, dropping further to 51 million by 2115.
Japan's Dai-Ichi Life, MS&AD Insurance Group, Nippon Life and Meiji Yasuda Life have all made significant overseas investments in recent years.
