Standard Life Aberdeen has sold off its insurance arm, which employs more than 3000 people in Scotland, in deal worth more than £3bn.

The Edinburgh-headquartered group has sold Standard Life Assurance to rival Phoenix Group, with the asset management giant receiving £2.3bn in cash and a 19.9% slice of the Phoenix business.

Phoenix will take on the UK mature retail and spread/risk books and the Europe, UK retail and workplace operation, while Standard Life Aberdeen will hold on to the UK retail platforms and financial advice business.

Standard Life Aberdeen said the insurance sale marked a "major step towards" becoming a world-class investment company and would help transform the firm into a fee-based capital-light business.

Sir Gerry Grimstone, Standard Life Aberdeen chairman, said: "This transaction completes our transformation to a capital-light investment business, a process started in 2010 with the sale of Standard Life Bank, continuing with the sale of our Canadian business and the merger last year between Standard Life and Aberdeen Asset Management.

"This transaction represents excellent value for our shareholders, including a comprehensive and mutually beneficial strategic relationship entered into with Phoenix Group, a longstanding partner of the firm.

"In addition, I am particularly pleased to note Phoenix Group's commitment to maintain operational headquarters in Edinburgh."