(Reuters) -The asset management arm of U.S. insurer giant MetLife (NYSE:MET) has agreed to buy PineBridge Investments from Hong Kong billionaire Richard Li's Pacific Century Group (PCG) in a deal valued at up to $1.2 billion, the companies said on Monday.
The acquisition will enable MetLife to expand its asset management capabilities, reflecting an emerging trend among insurers looking to leverage their assets for developing tailored investment platforms.
MetLife Investment Management's assets include public fixed income, private capital and real estate investments. As of Sept. 30, it managed $609.3 billion in total assets.
Following the completion of the PineBridge acquisition, its assets under management (AUM) are expected to exceed $700 billion.
The acquisition excludes PineBridge's private equity funds group and its joint venture in China.
PineBridge was established in 1996 as AIG (NYSE:AIG)'s investment advisory and asset management business and was acquired by Li's PCG in 2010 for $277 million.
Reuters reported in February that PCG was seeking to sell its majority stake in the asset manager and had hired JPMorgan to run the process.
The deal includes an $800 million upfront cash payment, with up to $400 million in additional payments based on meeting 2025 financial targets and a multi-year earnout structure, the New York-based company said.
PCG said it will concentrate on enhancing its core strengths through the development of Huatai-PineBridge, a joint venture in China, and a "uniquely positioned private fund business."
"With MetLife Investment Management's extensive platform and longstanding history, PineBridge is well-positioned to broaden its offerings and continue delivering value to clients worldwide," PCG said.