Aviva has reached an agreement with Bankia to transfer its entire holding in Spanish joint venture Aseval to the bank.
The deal sees Aviva net €608 million (around £494 million) in cash and will boost the insurer's capital position.
It is expected to be complete no later than April 2013, Aviva told the stock market, though its agreement is still subject to approval.
John McFarlane (pictured), chairman of Aviva, added: 'This settlement is in line with our strategy to increase Aviva's financial strength and we have realised significant value from our joint venture with Bankia.'
The news comes at the end of a year in which Aviva has been linked with the sale of its US arm and rolled out a restructure within its asset management division, Aviva Investors.
Cash from its deal with Bankia will increase Aviva's central group liquidity by €608 million (£494 million) and be used for 'general corporate' purposes, the firm said.