National Australia Bank's (NAB) asset management business, nabInvest, has acquired Aviva Investors Australia for an undisclosed amount.

The takeover excludes Aviva Investors Australia's direct property investment business and resources not directly associated with the Australian business.

"This acquisition enhances our capability in the largest and most competitive asset class in Australia," nabInvest chief executive Garry Mulcahy said.

"Domestic investors heavily favour Australian equities and it's important we provide choice in our offer," he said.

"Our nabInvest strategy is and always has been to create a market-leading direct asset management business diversified within and across a broad range of asset classes."

"In Aviva Investors Australia, we see a quality investment management firm, and a significant opportunity to grow and expand the business, leveraging the strength of the NAB Group's resources."

Aviva Investors has about $5.5 billion in funds under management as at 31 July 2011.

The terms of the agreement with Aviva Investors Group are confidential and subject to approval of the Australian Competition and Consumer Commission, NAB said.

NAB already bought Aviva Australia's wealth management business, a separate entity from Aviva Investors, in June 2009 for $825 million, which included the Navigator platform and Aviva's life insurance operations.

Through its in-house management teams and external partners, nabInvest manages about $51 billion.