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1999
Sale Was Seen As Disaster, Says Qc
The Age
Thursday March 25, 1999
The National Mutual Health Insurance sale of its majority-owned Benchmark Mutual Hospital Group had been described as a ``bloody disaster", the Victorian Supreme Court heard yesterday.
The description of NMHI's attempted $55 million sale of Benchmark is alleged to have been used in September 1998, in a conversation between NMHI's project manager, Mr Jim Griffin, and a minority shareholder, Mr Andrew Black.
Counsel for two other minority shareholders, Mr Simon Wilson, QC, told the court the conversation had taken place part-way through the complicated two-part Benchmark sale process.
The remark is alleged to refer to a situation in which NMHI received only one offer for Benchmark, at about $1 a share, compared with a Deloitte valuation of $1.35 to $1.97 a share.
Mr Wilson is acting for two minority Benchmark shareholders, Advent and Pafiko, which allege NMHI treated them unfairly during the sale process.
They allege they were not offered the same terms as other minority shareholders, particularly Mr Black's Advanstaff, to sign a ``realisation agreement" that would have guaranteed them $2.10 for each of their shares.
NMHI agreed to sell Benchmark to Marrego, a company associated with Australian Unity, for about $50 million last December.
But settlement of the sale, which cannot take place without 100per cent of the Benchmark shares transferring to Marrego, had been deferred until the end of the month, the court heard.
It was the second day of a trial before Mr Justice Philip Mandie. The defence is not expected to outline its case until early next week.
Counsel for NMHI, Mr Peter Bick, QC, told the court the case had a degree of urgency, as a ``sale with a value of about $55 million is hanging in the balance".
© 1999 The Age