UPDATE 1-Germany's Allianz grows in Brazil with $734 mln deal

(Adds deal details, quote by Allianz CEO in Brazil)

BRASILIA/SAO PAULO, Aug 23 (Reuters) - Germany’s insurer Allianz SE will acquire Brazil’s Sul America SA auto and property insurance portfolio for 3 billion reais ($734 million) in its largest push into Latin America’s biggest economy, it said in a statement on Friday.

The deal represents Allianz’ largest investment ever in Brazil, the insurer said. “Insurance in Brazil is expected to grow more than the GDP over the next years, as insurance penetration is very low,” said Eduard Folch, chief executive of Allianz’ Brazilian unit, in a phone interview.

Sul America will carve out its auto and property operations into a new company that will be acquired by Allianz, Folch said. The deal is expected to close within a year.

Last month, Sul America said Allianz had made a non-binding offer for its property and casualty (P&C) and auto units, and that if an agreement was reached, Sul America’s operations would be concentrated in health, dental, life and pension insurance and asset management products.

($1 = 4.0850 reais)

Reporting by Jamie McGeever in Brasilia and Tatiana Bautzer in Sao Paulo; Editing by Richard Chang