Great-West Life close to buying state-rescued insurer Irish Life: source

Canada Life, a unit of Canadian life insurer Great-West Lifeco , is close to a deal for state-rescued insurer Irish Life, a source familiar with the negotiations said on Sunday.

"It's at an advanced stage," the source said, requesting anonymity because he is not authorized to speak about the talks.

A spokesman for Irish Life declined to comment.

Irish Life, formerly the life insurance arm of bailed out Irish Life & Permanent, was taken over by the state after a planned sale of the unit was suspended last year. A source at that time told Reuters that Canada Life was the lead candidate to buy the group.

The Sunday Times newspaper reported that a deal would be agreed in the first quarter of next year.

Executives at Irish Life said in September that the company would need a period of sustained calm in the euro zone before the sale process would resume.

Ireland's government, which had already poured 2.7 billion euros ($3.6 billion) into IL&P to recapitalize its banking division, forked out 1.3 billion euros for Irish Life after a real estate and credit bubble burst, undermining the country's banking system and eventually forcing the government to seek a bailout.