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Connor Healthcare application to acquire 100% of Acurity
Commerce Commission declines clearance application for Connor Healthcare to acquire 100% of Acurity
11 December 2014
The Commerce Commission has declined an application from Connor Healthcare Limited to acquire all of the shares that it does not currently own in Acurity Health Group Limited.
The proposed acquisition would have seen three of the four private hospitals in the Wellington region – Boulcott, Bowen and Wakefield – come under common ownership, leaving only Southern Cross Hospital independent of Connor Healthcare.
The Commission is not satisfied that the proposed acquisition will not, or would not be likely to, substantially lessen competition in respect of a number of medical procedures performed in private hospitals in the greater Wellington region.
“Boulcott Hospital provides an important competitive constraint to the other hospitals in the Wellington region. For medical insurance providers, the greater the number of hospitals they have to play off against each other, the more competitive the price they will achieve which ultimately benefits consumers. If the acquisition proceeded, insurers would have had one less option and for some procedures Conner Healthcare would have been the only significant provider in the greater Wellington region,” said Commerce Commission Chair Dr Mark Berry.
Surgical procedures the Commission looked at included orthopaedic hips and knees, colonoscopy and gastroscopy.
“For some of the procedures we believe Southern Cross Hospital would be unable to expand to a sufficient extent to replace the competition that would be lost. The greatest difficulty Southern Cross Hospital would be likely to face, apart from enough physical capacity, would be attracting sufficient specialists to its facilities to perform procedures,” Dr Berry said.
Connor Healthcare is 100% owned by Evolution Healthcare which also owns Boulcott Hospital in Lower Hutt.
Acurity is a publicly listed company on the New Zealand stock exchange which owns and operates the Wakefield and Bowen private hospitals in Wellington and the Royston private hospital in Hastings.
ENDS
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