MILAN :Italy’s biggest insurer Generali on Wednesday said it would acquire full control of a non-life insurance joint-venture in China by buying out local partner CNPC Capital for around 99 million euros ($108 million).

Generali said it planned to expand its distribution network in China and bet in particular on green business insurance to tap into the country’s ambition to reach carbon neutrality by around 2060.

The acquisition of a 51 per cent stake in Generali China Insurance (GCI) follows CNPC Capital’s decision, it disclosed in November, to launch a public tender for its stake in its partnership with the Italian insurer.

It is the first instance in which a foreign insurer has acquired a controlling stake in a property and casualty insurer in China from a single state-owned entity through a public auction, Generali said.

The deal “represents a long-term strategic investment to develop a fully owned and controlled general insurance business in China,” it added.

“China is the world’s second largest general insurance market by premiums, with an attractive growth profile,” Rob Leonardi, Asia regional officer at Generali, said in a statement.

The investment comes at a time when growing geopolitical risks have heightened regulatory scrutiny of Western companies’ operations in China.

In October, a senior banking official told Reuters big banks in Britain were preparing for any future escalation of Western sanctions on China and had shared their “scenario planning” with the British and U.S. governments.

In September, the former chair of the U.S. securities regulator, Jay Clayton, told lawmaker big U.S. public companies should start disclosing their exposure to China to help investors and policymakers gauge potential risks.

Generali will continue to partner with CNPC Capital through their Generali China Life Insurance and Generali China Asset Management joint ventures, it said.

UBS acted as financial adviser to Generali.

($1 = 0.9137 euros)