The competition watchdog has blocked float hopeful Healthscope’s proposed purchase of a 123-bed rehabilitation hospital in Melbourne’s north, suggesting a potential difficulty the operator may face in going after future growth via acquisitions.
Private equity-owned Healthscope is poised for a $4 billion plus initial public offering that will most likely occur in July. The group, which is the second largest private hospital operator in the country, proposed to buy Brunswick Private Hospital from Healthe Care.
However the Australian Competition and Consumer Commission said on Thursday it will oppose the deal, on the basis it would lessen competition for private patients requiring rehabilitation services in Melbourne’s inner north.
“The ACCC is concerned that there are no other private rehabilitation hospitals in northern Melbourne and Healthscope would face only limited competition from the Epworth hospital in Richmond and St Vincent’s Private in East Melbourne, located in Melbourne’s inner east,” ACCC chairman Rod Sims said in a statement.