General Healthcare Group's proposed acquisition of Community Hospitals Group has been referred to th...
General Healthcare Group's proposed acquisition of Community Hospitals Group has been referred to the Competition Commission under the provisions of the Fair Trading Act 1973.
The secretary of state for trade and industry, Stephen Byers, has asked the Competition Commission whether the merger would be in the public interest, and to make a report before 30 June.
A similar bid for the Community Hospitals Group was made by BUPA last year. This proposal was also referred to the Commission, but refused because of fears that it would increase prices.
The move would have given BUPA a 22.7% stake, compared with around 26% if General Healthcare purchase the group.
Stephen Walker, specialist PMI intermediary at Medical Insurance Services, said: "If the acquisition of Community Hospitals will enable the new group to bring costs down, then I would welcome the move. The medical insurance industry has been trying to address the increase in premiums and if this move can help on the cost front, then it is to be applauded. But if, as I imagine, this is not the case, then competition will be reduced in the market place with no advantage to the industry."
