FRANKFURT Germany's Allianz said on Wednesday that it was planning to buy a majority stake in Singapore's Income Insurance for about US$1.6 billion to strengthen its foothold in Asia.

The offer by Allianz for a stake of at least 51% comes as the insurance sector in Singapore is experiencing consolidation and increased deal activity.

Allianz said it would offer S$40.58 per share for a transaction value of S$2.2 billion.

Allianz said the move would make it Asia's fourth-largest insurer, up from ninth previously.

"This majority stake is expected to elevate Allianz's presence in the fast-growing and attractive Singapore insurance market," Allianz said.

Income Insurance said Allianz was "committed to investing in Singapore" and that its own position in the market gave the deal "a strong and compelling rationale".

The target's top shareholder, NTUC Enterprise, which holds a nearly 73% stake, said it would remain a "substantial" shareholder and praised the deal.

  - Reuters