Southern Cross has a second crack at Aetna
Southern Cross Healthcare is having a second crack at getting regulatory approval to buy Aetna Health (NZ) after its first application was turned down.
Friday, September 1st 2000, 5:35PM
In its new submission to the Commerce Commission it has said that it would divest some of Aetna's health insurance policies. Despite making the offer it hasn't revealed how many it is prepared to sell.
The commission earlier turned down Southern Crosses application on dominance concerns. That is because the deal involved the two biggest health insurers getting together the combined entity would have a dominant market position.
Southern Cross chief executive Roger Bowie said in a statement that he was disappointed about the continued uncertainty for Aetna staff and policyholders, but had full confidence in the commission's process.
Aetna chief executive Steve Goldberg said, again in a statement, that the two organisations would continue to compete until the commission approved the "merger."
Besides health insurance Southern Cross provides travel insurance, it owns 13 hospitals and it is involved in workplace injury prevention and claims processing.
US-owned Aetna's business includes health services to the Health Funding Authority and programmes to manage workplace injuries.
Reports suggest the real cherry for Southern Cross in the deal is Aetna's more advanced computer systems, and its high-value contracts providing specialised administrative services for doctors.
Sources suggest Southern Cross is prepared to sell some policies if it can get hold of Aetna's computer systems and contracts.
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