Southern Cross makes second application for clearance to acquire Aetna Health, offers to divest assets
Published30 Aug 2000
The Commerce Commission today received a second application from Southern Cross Medical Care Society for clearance to acquire all the shares in Aetna Health (NZ) Limited.
Commission Chair John Belgrave said that on Friday last week the Commission declined Southern Cross' first application because of dominance concerns in the medical insurance market.
The second application includes an undertaking from Southern Cross that, if the proposal went ahead, it would divest some of the health insurance policies currently held by Aetna.
Southern Cross is New Zealand-based and provides health and travel insurance, owns 13 hospitals and is involved in work place injury prevention and claims processing.
Aetna is ultimately wholly owned by United States company Aetna Inc., which is reorganising its international businesses. It provides health insurance, health services to the Health Funding Authority and programmes to manage work place injuries.
The Commerce Act prohibits business acquisitions that result in dominance being acquired or strengthened in any market.
Parties can apply for a clearance, which the Commission will grant if it is satisfied that dominance is not acquired or strengthened. A clearance, if granted, protects an acquisition from court action under the Act.
The Act gives the Commission 10 working days in which to make its decision but allows for extension of time if necessary. Working day 10 will be September 13.
