(December 8 – 18:05 ET) – The Great-West Life Assurance Company has approved a corporate reorganization under which ownership of its U.S. subsidiary, Great-West Life & Annuity Insurance Company (GWL&A) will be conveyed to a newly-formed subsidiary of Great-West Lifeco.

The reorganization will be effective Dec. 31, 2000, subject to receiving regulatory approval.

“The reorganization completes a process started many years ago, of establishing separate and distinct operations in Canada and the U.S., to better focus on the respective markets,” said Raymond L. McFeetors, co- president and CEO of Great-West Lifeco, and president and CEO of Great- West Life.

The reorganization will not affect the existing financial strength and claims paying ability ratings of Great-West Life and GWL&A, says the company. “This reorganization will help place GWL&A on an equal footing with its competitors in the U.S.,” says William McCallum, co-President and CEO of Great-West Lifeco and president and CEO of GWL&A.

The reorganization was approved after a full review by Great-West Life’s Board of Directors on the unanimous recommendation of a Special Board Committee, following that Committee’s study of the proposed reorganization.

As well, Great-West Lifeco and Great-West Life entered into a share exchange agreement providing for the exchange of certain Great-West Life preferred shares which are held by Great-West Lifeco, for Great-West Life common shares.

Under the agreement, Great-West Lifeco will exchange all the 4,000,000 Great-West Life Non-Cumulative Perpetual Preferred Shares, Series K and 2,264,000 of the outstanding 5,175,955 Great-West Life Non-Cumulative Preferred Shares, Series N for 30,520 Great-West Life common shares.
-IE Staff