L&P poised to acquire Quinn health insurer
01 May 2011 By Richard Curran
Irish Life & Permanent (IL&P) looks set to acquire the life and health insurance business of Quinn Insurance in a deal which could be settled in the coming weeks.
Quinn’s life and health insurance operations, partially made up of the former Irish Bupa business, is profitable and could be worth close to €100 million.
This part of the Quinn Insurance did not g o into administration and therefore the vendor is actually Anglo Irish Bank, following its decision to take ownership of the shares in the ultimate holding company of the former Quinn business empire.
The bank is holding a tender to buy the business and, despite some speculation that American insurer Liberty Mutual might buy this smaller arm of Quinn Insurance, that is now not going to happen.
Sources close to the process said this was not part of Liberty’s core insurance operation and, since Liberty and Anglo Irish Bank have formed an Irish insurance joint venture, the bank would effectively be selling the health insurance arm to itself.
Irish Life & Permanent is the clear front runner for the business. The acquisition would come at a time when IL&P is set to split with the non-Permanent TSB parts of the group floated on the stock market.
A transfer of Quinn’s health insurance operation to IL&P would be part of a major shake-up in the health insurance market. VHI is due to restructured and possibly split up, with the more universal health provision side retained in some role and its higher net worth and more profitable part of its book possibly sold off.
Aviva, the other player in the health insurance market, is the majority shareholder in Aviva Health.
The minority stake in this venture is owned by AIB, a shareholding that is unlikely to survive the bank’s restructuring process.
This could pave the way for Aviva to acquire AIB’s stake and either IL&P or Aviva to buy part of the VHI book.
This would reduce the number of service providers in the sector down to just two.
Quinn’s health insurance business has been a strong cash cow for the group with a relatively young customer base.
The direction of the health insurance market looks set to change as James Reilly, the new minister for health, pushes towards universal health cover for everyone.
www.sbpost.ie/themarket/...ire-quinn-health-insurer-55991.html
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