IAG has finalised its deal to buy nearly a quarter of China Pacific Property Insurance (CPPI) for $375 million.

CEO Michael Hawker signed a memorandum of understanding with CPPI in May and intended to purchase a 40% stake in the company for up to $550 million – but the insurer will now buy just 24.9% instead.

CPPI has about 11% of the highly concentrated Chinese property insurance market. IAG says it has lodged the draft transaction agreements with the China Insurance Regulatory Commission (CIRC) for preliminary review.

CPPI and IAG intend to proceed to signing the transaction agreements as soon as possible following the CIRC’s review and formal approval by the shareholders of China Pacific Insurance (Group), the parent company of CPPI.