Portugal said Thursday it had picked Chinese conglomerate Fosun to buy up to 80 percent of the insurance arm of public bank Caixa Geral de Depositos, as part of an EU-IMF ordered privatisation drive.

Fosun will pay one billion euros ($1.36 billion) for the unit, junior minister Manuel Rodrigues said after a cabinet meeting.

The insurance arm of the Caixa bank consists of several insurance companies which together make up about a third of the Portuguese insurance market.

Fosun, one of China's biggest conglomerates, beat out US investment fund Apollo Investment for the deal.

"Fosun was retained because of the better financial conditions and its strategic project that maintained the unity of the group," Rodrigues said.

Fosun also proposed to expand the Portuguese companies in Asia and Africa with a particular focus on China, the minister said.

The Portuguese government has pulled off several privatisations since it signed on to a painful 78-billion-euro bailout programme in May 2011 under the auspices of the European Union and International Monetary Fund.

With this latest divestment, the privatisation drive has raised 8.1 billion euros, the minister said.

National airline TAP and the cargo unit of the national railway are the next targets to be spun-off in the programme.