Great-West Offers $4.8 Billion For Canada Life

Both Manulife and Great-West, which is based in Winnipeg, Manitoba, say acquiring Canada Life would help them dominate the Canadian life market and increase their presence in the United States.

But Great-West has gone out of its way to praise Canada Life.

"We have great respect for the staff and management of Canada Life and look forward to working with them," Raymond McFeetors, Great-Wests co-president, says in a statement.

Great-West says its parent company, Power Financial Corp., will put up at least $525 million in cash to help finance the deal. Great-West and Power Financial are both units of the Power Corporation of America, Montreal.

Analysts at Moodys Investors Service, New York, have raised questions about the scope of the deal.

The deal would increase Great-Wests share in Canada, but paying for Canada Life and integrating its operations with existing Great-West operations could be risky, the analysts note.

Reproduced from National Underwriter Edition, February 24, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.