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Australia's MBF Gets Bid from U.K.'s BUPA

Reuters
Thursday, 5 Jul 2007 | 10:28 PM ET

British-owned health insurer BUPA has made a bid for Australia's second-largest private health fund MBF, possibly worth as much as A$2 billion (US$1.7 billion), newspapers said on Friday.

The Australian Financial Review and the Sydney Morning Herald newspapers said BUPA had approached MBF in the past few days with a takeover offer for the health insurer to challenge the country's biggest health fund, state-owned Medibank Private.

The Australian Financial Review said the proposal was valued at more than A$1.5 billion, while the Sydney Morning Herald said the offer was about A$2 billion.

MBF said in a statement on Thursday that it had received approaches from several parties, including private equity, but said the confidential nature of the discussions prevented it from identifying the parties or making further comment.

However, it said the company still favored a demutualisation and share market listing.

MBF is one of several private health insurance companies in Australia considering a listing or other options as they prepare for increased competition after an Australian government decision to sell Medibank Private.

Friday's reports said the BUPA proposal valued MBF at a premium to its likely market capitalization through a float.

MBF has yet to set a timetable for its proposed listing.

The A$10 billion-a-year industry has some 40 insurers, and a Medibank sale is expected to spark major changes.

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