Canadian group Manulife Financial and MetLife in the US are understood to be among the potential bidders to acquire a major stake in AmLife Insurance, the life insurance business of Malaysian bank AMMB Holdings.
Sources familiar with the matter were quoted by Reuters as saying that Zurich Insurance, Hong Kong-based Pacific Century, P&C insurer ACE and two underwriters from Japan were also participating in the bidding.
These companies have placed their first-round of bids to acquire up to 70% stake in AmLife Insurance, in a deal valued at nearly $350m.
As per regulations in the country, a foreign company cannot own more than 70% stake in Malaysian insurance companies.
The potential deal highlights the growing financial influence of Southeast Asian countries, whose businesses have attracted many global financial firms to set up their operations in the region.
With growing income and a young population, Malaysia represents the ninth-biggest insurance market by premiums.
The news agency reported citing Swiss Re estimates that Malaysia's life insurance industry increased 13.5% during the last three decades and its ratio premium-to-GDP was 3.3% compared to nearly 10% for Hong Kong and over 4% for Singapore.
Recently, the insurance joint venture of CIMB Group Holdings and Aviva Plc was acquired by sovereign wealth fund Khazanah Nasional and Sun Life Financial Inc for $597m.