BUPA Australia welcomes MBF's progress to vote on merger
February 2008
Bupa Australia welcomed today’s announcement by MBF Australia that MBF contributors will vote on the proposal to merge the two health funds.
The confirmation follows the decision today by MBF’s Council to accept amendments to MBF’s constitution, which allows the merger proposal to progress to a vote by Contributors in May.
In December 2007, the MBF Board announced its support for the $2.41 billion merger proposal to combine its business with Bupa Australia and create Australia's leading private health fund.
Bupa Australia's Managing Director Richard Bowden said the MBF Council’s decision was another positive step towards a merger which would deliver benefits for customers and employees of both health funds and the broader Australian health sector.
“Today’s decision by the MBF Council brings the proposed merger one step closer. It will strengthen the existing brands, while the health cover for customers of both health funds will not change. The merged business aims to lead the industry in consistently offering lower premium increases, lower management expenses and better products and services for its customers.
"Combining these two health funds is a unique opportunity to create Australia's largest health insurer, providing greater competition and achieving our common goals. This merger is by far the best option for industry consolidation we can foresee and will provide future customer benefits,” Mr Bowden said.
The proposal has also been cleared by the Australian Competition and Consumer Commission (ACCC) and the Foreign Investment Review Board (FIRB).
Dean Holden will continue as managing director of Bupa's international businesses, which includes its Australian insurance operations.
During the merger implementation period MBF Managing Director and Chief Executive Officer, Eric Dodd, will become managing director of the combined business in Australia before making the transition to a non-executive board role. Richard Bowden will become the Deputy Managing Director and the Chief Operating Officer.
Bupa Australia operates the HBA and Mutual Community health funds, which support the health needs of more than one million Australians.
The merged business will become Australia’s leading health insurer supporting close to three million Australians.
Background information:
About Bupa Australia:
The health care needs of more than one million Australians are supported by Bupa Australia, giving the health fund a national market share of 10.1 percent. Bupa Australia is known as HBA in all states except South Australia and the Northern Territory where the customer brand is Mutual Community. Both brands have provided health cover for Australians for more than 70 years.
The majority of our customers are located in Victoria (543,000) and in South Australia (355,000).
As part of a strong global health focused group Bupa Australia continues to lead the industry in product innovation and improved services and benefits for its customers. In addition, Bupa Australia provides customers with travel, motor vehicle, home and contents insurance services.
About MBF:
MBF is Australia’s largest, non-government private health insurer covering nearly 2 million people. MBF provides private health insurance throughout Australia and is the number one or number two private health insurer in Queensland, New South Wales, Tasmania and the Northern Territory. In addition to its core private health insurance business, the MBF group of companies offer life and travel insurance as well as financial planning, superannuation and managed investment products through ClearView Financial Solutions, ClearView Life Nominees and MBF Life. In the year ended 30 June 2007 MBF posted a 23.5 percent rise in consolidated net profit after tax of $223.5 million.