Australian Health Management Group demutualises and acquired by Medibank Private Ltd for $357 million
Client(s) Australian Health Management
Jones Day advised Australian Health Management Group Ltd. (ahm) in its AU$367 million ($357 million US) acquisition by Medibank Private Ltd. via a demutualisation and Scheme of Arrangement.
Under Medibank's proposal, ahm will demutualise, and as a result of Medibank's acquisition, $367 million will be shared among eligible ahm members according to allocation rules that are yet to be finalized. ahm is Australia's eighth largest health fund, and has operated as a mutual for the last 35 years. In addition to the provision of health insurance, ahm has developed and delivers innovative health management programs to 311,000 members throughout Australia. Medibank is Australia's largest health insurance fund with over 3 million members. The transaction represents only the second demutualisation and acquisition of a private health insurance fund in Australia, following BUPA's acquisition of MBF a few months ago. It is expected that the Australian private health insurance industry will continue to consolidate over the next 12 months.ahm's demutualisation is subject to approval by the requisite majority of eligible members in accordance with procedures set down in its constitution. Medibank's acquisition of ahm by way of a Scheme of Arrangement is subject to court and member approval. It is expected that an Information Memorandum for the transaction will be issued to ahm members in October 2008, with a demutualisation postal ballot to follow in late November 2008. Assuming that the demutualisation vote is successful, an extraordinary general meeting and scheme meeting for ahm members will be held shortly thereafter in early December 2008.