FAQs
3 October 2007- Background & Key messages
- Frequently asked questions
1. Background & Key messages
Following several months of negotiations BUPA has confirmed its acquisition of Amity (Australia) and Guardian Health Care (New Zealand). Amity and Guardian have a total of 96 care homes with a combined annual turnover of A$344 million / NZ$388 million (in FY07), are the leaders in their respective markets and will become part of BUPA Care Services (UK).
- BUPA is already a leading provider of care homes in Europe, with 20,000 beds in 300 UK care homes and 4,300 beds in 43 homes in Spain.
- Completion of this acquisition is expected before the end of the year, pending regulatory approval.
- The first priority will be to provide continuity of care for the residents of these homes and support for the employees who care for them.
- Amity and Guardian have excellent management teams and facilities which will enable us to deliver the same high standards of care as we do in our existing aged care homes
- This acquisition is part of BUPA’s long term commitment to the Australasia region and expansion of our existing operations in the aged care sector in the UK and Spain.
2. Frequently asked questions
a) What price did BUPA pay for the purchase of Amity and Guardian Health Care?
The purchase price was A$1.225 billion / NZ$1.4 billion. Completion of the acquisition is expected before the end of the year, subject to regulatory approval.
The purchase of these two strong and high quality aged care services is part of BUPA’s long term strategy to grow and strengthen its operations in Australasia. It also builds on BUPA’s proven track record as a leader in providing high quality aged care services to thousands of residents in its homes in the UK and Spain.
b) Is this purchase of Amity and Guardian Health Care an investment by BUPA Australia, using the funds provided by your health insurance operations?
No, the funding to acquire the Amity and Guardian Health Care businesses was made possible through the cash reserves provided by our parent BUPA. BUPA is a highly experienced and credentialed operator of care homes in the UK and Spain and this acquisition is a natural expansion of their commitment to the health sector in the Australasia region. Our investment in Amity and Guardian Health Care is part of our long-term commitment to be a provider of quality aged care services in the region.
c) Will BUPA now offer Private Health Insurance products to Australians and New Zealanders that incorporates cover for aged care later in life?
This is not something that we are considering at present. There are other funding options available for Australians to support them in the later years of their life.
Initially our focus will be on supporting the residents, families and staff of the Amity and Guardian Health Care homes to ensure they continue to have access to the very best of care and accommodation in Amity and Guardian aged care homes, and that this care remains affordable.
d) Will BUPA be relocating the head offices of Amity and Guardian Health Care to your Melbourne head office?
No, there are no plans to integrate the offices of Amity and Guardian Health Care. As with all sectors of the health industry managing aged care operations requires a distinct set of skills that are unique to this particular area of care. As occurred with our acquisitions in the UK and Spain, we anticipate little or no cross-over between the Private Health Insurance and aged care businesses in Australia.
e) Will BUPA guarantee that residents will be able to stay in their local homes?
Yes, While residential homes continue to provide the very best standard of quality care BUPA does not envisage a need to relocate residents.
f) Does the acquisition of the Amity and Guardian Health Care businesses mean that BUPA will not be progressing with a merger with MBF?
BUPA remains committed to building a strong presence within the Australasia region.
Together MBF and BUPA Australia would create the country’s leading health fund, which would be in a stronger position to hold down premiums, whilst providing greater efficiencies and improved services for members – as well as being a leading voice in Australian health care.
BUPA Australia is continuing to seek the necessary regulatory approvals for its proposal and will re-initiate discussions with MBF once these approvals have been progressed.
g) Will BUPA be re-branding the Amity and Guardian Health Care businesses under the BUPA, HBA or Mutual Community brands?
Our first priority is to ensure the residents, staff and families continue to receive the high quality care and support they receive at present. Both Amity and Guardian Health Care have established and respected brands within the aged care sector and there are no plans to adjust the brands at present. Retaining existing brands for businesses is no different to our operations in the USA, Spain, Denmark and in Australia where we operate businesses under their local brands.
h) Who are the regulators that you will need to obtain approval from for this transaction?
BUPA is currently lodging applications with the appropriate regulators - Foreign Investment Review Board (FIRB) in Australia and the Overseas Investment Office (OIO) in New Zealand.