Mitsubishi UFJ Financial Group Inc. has decided to offer for sale of its Thai branch to Bank of Ayudhya Pc1 for an 8% stake in the company, according to three sources familiar with the deal.

The Thai lender would issue new shares to Mitsubishi UFJ following the purchase. This sale would further strengthen the Japan-based company's controlling stake in Bank of Ayudhya. 

Based on the market capitalization of THB 227.8 billion from the Bank of Ayudhya, the deal would bring up Mitsubishi UFJ's business value to around THB 18.2 billion (US $588 million).

Mitsubishi has offered to pay current shareholders US $5.6 billion for as much as 75% of Bank of Ayudhya, now the fifth-largest lender in Thailand. The Japanese bank also plans to buy as much as 50% additional stake of Bank of Ayudhya from existing investors.

Bank of Ayudhya shareholder General Electric Co. (GE) has earlier agreed to the sale its 25% Bank of Ayudhya stake to Mitsubishi UFJ.

The terms of the sale has not been finalized and is still subject to change, two people with knowledge of the deal said.