UK's BUPA sweetens MBF merger bid

MBF is Australia's second largest private health insurer, and BUPA Australia is the domestic arm of British health insurer BUPA, which insures eight million people worldwide.

"The revised proposal would involve the merger of the two private health insurance businesses in Australia and a cash payment of $2.41 billion for MBF contributors," MBF said.

MBF has been developing a proposal for demutualisation and listing on the Australian stock exchange early next year, while considering an offer believed to be around $2 billion, that was put to it by BUPA Australia in August.

"The board is actively considering the (revised) BUPA proposal and preliminary informal consultations have been held with the MBF council," MBF said.

"The board expects to make a decision in the near future as to whether to recommend this proposal formally to the MBF council and contributors or continue with the demutualisation proposal."

BUPA Australia described its revised proposal to MBF as "significantly enhanced and final".

"Together MBF and BUPA Australia would create the country's leading health fund, which would be in a stronger position to provide affordable health insurance, greater efficiencies and improved services for members, as well as being a leading voice in Australia's health sector," BUPA Australia managing director Richard Bowden said.

BUPA Australia operates as Mutual Community in South Australia and the Northern Territory, and as HBA in all other states.

MBF and BUPA Australia said they would not be commenting further at this stage.

NIB Holdings Ltd was the first private health insurer to list on the Australian stock exchange (ASX: ASX.ax) , making a trading debut last month.

Source:By Trevor Chappell