UPDATE 1-ING sells stake in Chinese investment firm for 98 mln euros

(Adds detail, background)

AMSTERDAM, Oct 8 (Reuters) - Dutch bank and insurance groupING said on Monday it has agreed to sell its 33.3percent stake in Chinese investment management firm ChinaMerchants Fund for 98 million euros ($128 million) to the twoother joint venture partners.

The financial services group is in the process of sellingits Asian investment management and insurance operations as itseeks to repay state aid and meet European requirements for its2008 state bail-out.

The Chinese divestment will result in a net gain of 64million euros, ING said in a statement. The Dutch group couldraise around $7 billion from the whole Asian insurance sale.

China Merchants Bank Co Ltd and China MerchantsSecurities Co Ltd are the buyers of ING's stake inthe Chinese investment business, which has a market share ofabout 3 percent in the Chinese mutual funds market, ING said.

(Reporting by Gilbert Kreijger; Editing by Sara Webb)


Messaging: gilbert.kreijger.reuters.com@reuters.net))

Keywords: ING CHINA/