Published on Tuesday 19th February 2013

Minister for Finance, Mr. Michael Noonan, T.D. confirms sale of Irish Life to Great-West Lifeco

The Minister for Finance today (19th February 2013) confirmed that agreement has been reached with Great-West Lifeco (Canada Life) for the sale of Irish Life for €1.3 billion with an additional dividend of €40 million being paid to the State prior to completion.

The agreement is conditional, most notably on receipt of regulatory approvals, which are customary in a deal of this nature.

Welcoming the agreement, Minister Noonan stated:
“I am very pleased to announce that an agreement has been reached with Great-West Lifeco for the sale of Irish Life. 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.
The Irish economy is entering its third consecutive year of growth, our deficit is on a downward trajectory and we are beginning to attract the levels of investment required to create jobs and to make a full return to the markets. This progress was one of the reasons that led Great-West Lifeco to renew their interest in late November 2012, almost a year to the day after they previously withdrew.

Great-West Lifeco’s Irish business, Canada Life (Ireland), is already a significant employer and is the largest Canadian employer in the State. Today’s investment by a company of their stature is a significant vote of confidence in the Irish economy and I am sure that this will lead to further investment. The transaction is even more significant to the State when seen in the context of other recent events. All told €10 billion has been invested or committed in the past six months, mainly by international investors, in transactions managed by the State or entities controlled/owned by the State

Irish Life manages approximately one million policies, with over €37 billion of assets under management and employs 2,200 people in Ireland. The financial strength of Great-West Lifeco will be of great benefit to the life assurance sector in Ireland. I would like to take this opportunity to wish Great-West Lifeco and Irish Life every success in the future”

Note to editors:
A €1.3 billion cash injection would, combined with the Bank of Ireland Contingent Capital deal, and all other things being equal, reduce GGD to GDP from 121.3% at end 2013 (per Budget 2013) to 119.9%. As the acquisition did not constitute a capital transfer it will not have an impact on the GGB but the €1.3 billion will positively impact the Exchequer deficit.

The €10 billion investment is made up as follows
· Irish Life (€1.3bn)
· Bank of Ireland CoCos (€1bn)
· Bank of Ireland Covered Bond (€1bn)
· Bank of Ireland Subordinated Debt (€0.25bn),
· AIB Covered Bonds (€1bn),
· NTMA Syndicated Tap of 2017 Bond (€2.5bn)
· NTMA Treasury Bill Programme (€0.5bn)
· ESB Bond (€0.5bn),
· Bord Gais Bond (€0.5bn),
· 4G Licences (€0.9bn),
· NTMA SME Equity Fund (€0.2bn),
· SME Turnaround Fund (€0.05bn),
· SME Credit Fund (€0.2bn).
Statement by Minister on acquisition in June 2012

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