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Aegon and Tsinghua Tongfang on Tuesday announced the signing of a Joint Venture Agreement to replace Aegon's existing partner in its life insurance company in China--Aegon CNOOC.

Aegon and Tsinghua Tongfang will each own 50 percent of the life insurance company when the transaction – which is pending regulatory approval is complete. Tsinghua Tongfang will be the domestic shareholder in the joint venture.

"The acquisition of 50 percent of Aegon-CNOOC's shares is key to building our financial business arm. And this combination puts the new joint venture in an excellent position to fully realize the opportunities in the life insurance market in China. We've always been looking for the opportunity to strengthen our financial pipeline," Lu Zhicheng, Tsinghua Tongfang's Chairman said.

Tsinghua Tongfang is the flagship enterprise among the science and technology industry group of Tsinghua University. It was established by Tsinghua University in 1997 and listed on the Shanghai Stock Exchange. By leveraging Tsinghua University's R&D strength and talents, the company has built a powerful high-tech incubator, and has been continuously innovating and exploring in the information, energy and environment industries. Tsinghua Tongfang has now developed into one of the top 500 enterprises of China.

According to Alex Wynaendts, CEO of Aegon, the development of innovative new products and services will be enhanced by the combination of Tsinghua Tongfang's technological expertise and Aegon's experience in life insurance in over 25 markets worldwide.

Aegon has been in China for more than a decade and the company is committed to sustainable long-term development. The relatively low insurance density and penetration rate, aging population, financial reform and the emerging middle class will lead to a high demand for protection and retirement products and services in China. The Chinese life insurance market is of great attraction to this global insurance giant.

During the signing ceremony, both shareholders reiterated that the business operations of Aegon-CNOOC are not impacted by today's announcement.