Asian insurance giant AIA said it will buy ING's Malaysian insurance unit for $1.73 billion, the Dutch banking firm's first step in selling off its assets in the region. Hong Kong-listed AIA, which is partly owned by the troubled American International Group, on Thursday said the two parties aim to complete the acquisition by the first quarter of 2013. The deal is subject to regulatory approval. AIA said the 1.34 billion euros ($1.73 billion) deal will make it the number one insurance provider by premiums in what it described as the "high-growth Malaysian market". "We view the acquisition as a rare and compelling opportunity in an attractive growth market," group chief executive Mark Tucker told reporters. ING Malaysia is the third largest insurer in Malaysia, serving more than 1.6 million customers, according to AIA. ING put its Asian business up for sale in January after scrapping plans to float the unit along with its European insurance operations, saying a tough market in Europe no longer made a combined European-Asian IPO sensible. The European Commission has told ING to restructure its business, as the Dutch firm seeks to repay 10 billion euros in state aid it received in October 2008 during the financial crisis. "Today's announcement is the first major step in the divestment of our Asian insurance and investment management businesses and shows that ING continues to make steady progress in the restructuring of our company," ING Group chief executive Jan Hommen said in a statement. ING said the sale will result in a net gain of 780 million euros. It is still looking to sell off its other Asian assets. AIA on Thursday also said the value of its new business in the three months to August 31 grew 22 percent year-on-year to $300 million, driven by growth in the Singapore, Indonesia and the Philippine markets. The firm, which operates in 14 Asia-Pacific markets, raised $20.5 billion in an initial public offering in 2010. Its Hong Kong-listed shares rose 0.34 percent to HK$29.70 by the break, while the benchmark Hang Seng Index up 0.24 percent.