<!-- Swiftype Variables -->

Money Management

Principal Financial to up stake in Malaysia money management joint venture to 60%

Zafrul Aziz, group CEO of CIMB, said the joint venture will help the business serve its customers better.

Principal Financial will also buy another 10% stake in CIMB-Principal Islamic Asset Management

Principal Financial Group will acquire an additional 20% stake in Kuala Lumpur-based CIMB-Principal Asset Management Group from its joint venture partner, Malaysian financial conglomerate CIMB Group, according to a joint announcement by Principal Financial and CIMB.

The deal gives Principal a majority 60% stake in the 70 billion ringgit ($17.5 billion) Southeast Asian money management firm. Principal Financial will pay up to 470.3 million ringgit for that additional stake, as well as an additional 10% stake in CIMB-Principal Islamic Asset Management, leaving both partners with a 50% stake, according to the joint news release.

The joint venture, with operations in Malaysia, Singapore, Indonesia and Thailand, will cease to be a subsidiary of CIMB.

Zafrul Aziz, the group CEO of CIMB, said in the news release that "scale and extensive investment expertise are important to this business and … this strategic realignment will enhance the value proposition of the joint venture to enable us to serve our customers better.

Pedro Borda, president of Southeast Asia and India with Principal Financial, said the majority stake in CIMB-Principal Asset Management will allow Principal Financial to bring its asset management expertise to bear while "still leveraging the multichannel distribution power of CIMB to continue to serve our customers."

Spokesmen from Principal and CIMB couldn't immediately be reached to comment on whether changes in CIMB-Principal Asset Management's leadership would follow the completion of the deal, expected by the second quarter of 2018.