Bloomberg News

Great-West Lifeco Said to Lead Bidders for Irish Life Unit

November 30, 2011

(Updates with company comment in fifth paragraph.)

Nov. 18 (Bloomberg) -- Great-West Lifeco Inc., the Canadian owner of Boston-based Putnam Investments, is the leading candidate to acquire Irish Life & Permanent Plc.’s life assurance unit, according to two people familiar with the matter.

The Winnipeg, Manitoba-based company’s Irish unit, Canada Life, bid in excess of 1 billion euros ($1.35 billion) for the largest insurer of its kind in Ireland, said people, who declined to be identified, as the process is private. Irish Finance Ministry officials have identified Canada Life to enter exclusive talks on the Irish Life unit, though the government has yet to ratify this, they said.

Prime Minister Enda Kenny’s government is splitting up Irish Life to lower the cost of bailing out the Dublin-based group’s unprofitable bank unit. A joint bid from U.S. leveraged buyout firms JC Flowers & Co. and Apollo Global Management LLC and an offer from CVC Capital Partners Ltd. had also been shortlisted for the life assurer, three people said on Aug. 19.

Irish Life is 99.5 percent state owned, after taxpayers put 2.7 billion euros into the company in July. The central bank ordered the company to raise a total of 4 billion euros following stress tests by the central bank in March.

Finance Ministry spokesman Eoin Dorgan and Irish Life spokesman Ray Gordon declined to comment on the process. Marlene Klassen, a spokeswoman for Canada’s second-largest life insurer, said the company doesn’t comment on rumors or speculation.

International Bailout

Ireland has injected a total of 62 billion euros into its banking system since it came close to collapse three years ago. The country sought an international bailout last year, partly to cover the mounting cost of the country’s bank rescue.

The government is seeking to attract overseas investors for its financial sector. The state sold a combined 35 percent stake in Bank of Ireland Plc, the country’s largest bank by assets, last month to a group of investors including Fairfax Financial Holdings Ltd, WL Ross & Co., and Fidelity Investments.

Great-West rose 0.6 percent to C$20.74 at 9:32 a.m. in Toronto trading. The shares have fallen 22 percent this year.

--With assistance by Sean B. Pasternak in Toronto. Editors: Dara Doyle, Francis Harris

To contact the reporter on this story: Joe Brennan in Dublin at jbrennan29@bloomberg.net

To contact the editor responsible for this story: Edward Evans at eevans3@bloomberg.net


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