Irish Life back in private sector

Pensions and life assurance company Irish Life has been sold by the Government for €1.3bn.

Canadian investment and insurance giant, Great-West Lifeco, bought the business after protracted negotiations delayed by the eurozone financial crisis.

Finance Minister Michael Noonan said the deal gives taxpayers a full return on the bailout needed to rescue Permanent TSB, the mortgage wing of the then Irish Life & Permanent (IL&P).

The state will get an additional dividend of €40m as part of the deal.

“Today’s deal is the first time during this crisis that a company in which we have invested has been returned fully to private ownership. This is a historic transaction and provides the Irish taxpayer with a full return on its investment in Irish Life,” Mr Noonan said.

Under the deal Great-West Lifeco’s Canada Life will be merged under the Irish Life brand.

Established in 1939, Irish Life is the largest life and pensions and investment management group in Ireland, with more than one million customers and €37bn of assets under management. It employs 2,200 people in Ireland.

Allen Loney, president and chief executive of Great-West Lifeco, said the deal commits the company to Ireland, where Canada Life has operated since 1903.

“Customers of both companies will have continuity of their products and customer service,” Mr Loney said.

He added: “There is a good culture fit.”

Kevin Murphy, Irish Life chief executive, said the deal was a major vote of confidence in Ireland and Irish Life.

“It is very good for the Irish economy, our clients, brokers and employees. Canada Life is a well respected and long standing business in Ireland,” he said.

IL&P had been advised in 2011 that it must sell off assets in order to meet capital funding requirements as measured under the Central bank’s stress tests.

The deal was almost struck late that year but fell through due to concerns about the eurozone crisis.

Mr Noonan said Great-West Lifeco renewed interest in buying Irish Life in November last year on the back on Ireland’s return to the global money markets and other economic improvements.

Canada Life has more than 150,000 customers and employs more than 600 people.