Bermuda-based Athene Holding Ltd. has agreed to acquire Liberty Life Insurance Company, the U.S. life insurance business of RBC Insurance for US$628.1 million, Royal Bank of Canada (TSX:RY) said Friday.

The deal is subject to regulatory approvals and customary closing conditions, and is expected to close in early 2011.

Immediately following the closing of the acquisition, Liberty Life will reinsure its life and health insurance business to Birmingham, Alabama-based Protective Life Insurance Company and a portion of its annuities to Athene Life Re Ltd., a Bermuda based subsidiary of Athene Holding Ltd.

RBC expects that the transaction will result in a loss of approximately US$115 million under Canadian generally accepted accounting principles (GAAP) on both a pre and after tax basis.