Aviva PLC (LON:AV.) has agreed to sell a majority stake in its Singapore subsidiary in a £1.6bn deal, including £1.2bn of cash.

The deal is with a consortium led by Singapore Life (Singlife) and includes TPG and Sumitomo Life.

Aviva said the deal proceeds will be used to further strengthen the company’s liquidity, as part of its broader capital management and debt reduction effort.

“The sale of Aviva Singapore is a significant first step in our new strategy to bring greater focus to Aviva’s portfolio.

“We have achieved excellent upfront value for shareholders but have also retained an investment in a leading Singapore life business with attractive long term growth potential.

“The proceeds from the sale will further strengthen our financial position and enhance our ability to meet our strategic objectives.

“We continue to work at pace and are seeking to take decisive action on our portfolio with the goal of further enhancing long term value for our shareholders.” 

The deal is expected to complete by January 2021.