Two Malaysian state-backed funds have said they will buy Battersea Power Station in a deal that values it at around £1.6bn - making it the biggest property deal carried out in the UK.

The terms of the deal value it ahead of the UK's biggest ever property transaction, the £1.28bn sale of the 'Walkie Talkie' skyscraper in the City last year, which was acquired by a Hong Kong firm.

Asset management group Permodalan Nasional Berhad, which has £50bn of assets under management, plans to buy the building with pension fund Employees Provident Fund of Malaysia, which controls the private sector pension pot.

The buyers will also provide a cash injection that will allow Battersea Power Station's restoration - which has been hampered by increased costs and delays - to be finished.

They are buying the stake from Malysian developers Sime Darby Property and SP Setia, in which PNB is a major shareholder and so indirectly owns part of the development. EPF also owns 20pc of the entire development, and will switch from a developer to an asset manager in this reorganisation.