Tokio Marine Holdings Inc. said it will pay $374 million to form a joint venture to sell mortgage and homeowners insurance for Caixa Econômica Federal, the Brazilian state-owned bank.

Caixa’s insurance holding subsidiary, Caixa Seguridade, will set up a new insurer entity and allocate new shares to Tokio Marine’s Brazil unit, Tokio Marine Seguradora S.A. (TMSR), which will hold 50.01 percent of the joint venture.

“As a global insurer, Tokio Marine Group has been focusing on expanding scale and profitability of its international business as the key growth driver of the overall group,” said Tokio Marine Holdings (TMHD) in a statement announcing the deal. “We have been pursuing organic and strategic M&A initiatives in both developed and emerging markets in order to capture growth opportunities in the global insurance market and to further diversify our business portfolio.”

Through a series of acquisitions, which included the recent acquisition of Privilege Underwriters Inc. (PURE), Tokio Marine Group has diversified its global portfolio in developed markets, especially focusing on specialty primary insurance business, the company said.

It also has been seeking growth opportunities in emerging markets where it expects attractive mid-to-long-term growth, said the company, citing its 2018 purchase of Insurance Australia Group’s (IAG) P/C business in Thailand and Indonesia as well as its minority investment in Hollard Group, which sells life and P/C business in South Africa and other Sub-Saharan countries.

The company’s Brazilian business, TMSR, has been expanding in recent years and is “now ranked fifth in terms of market share in the Brazilian auto insurance market,” TMHD continued.

“Our joint venture partner Caixa is a state-owned bank that holds around 70 percent market share in the Brazilian mortgage loan market,” said TMHD, noting that it the joint venture will help it further diversify its operations through the expansion into the country’s growing mortgage and homeowners sectors.

The joint venture is expected to begin operations by February 2021. The closing of the transaction is subject to regulatory approvals.

*This story ran previously in our sister publication Insurance Journal.