IL&P sets sights on Quinn Health

IRISH Life & Permanent (IL&P) is set to become the new owner of Quinn Healthcare — the latest element of the Quinn Group of businesses set for sale — before the end of the year.

IL&P, which is facing its own restructuring process in the coming months, has been mooted as a possible buyer for the health and life insurer for some time.

Over the weekend, a report suggested that IL&P was “poised” to buy the company. However, industry sources suggested yesterday that while nothing is thought to be imminent, IL&P is in “a good position” to conclude a deal and that such an outcome could be expected by August or September.

A spokesperson for IL&P declined to comment on the matter, while a representative of Quinn Healthcare only said that the sale of the business hadn’t yet been concluded.

IL&P remains the favourite to buy Quinn Healthcare mainly because US insurer Liberty Mutual doesn’t see it as a necessity following its decision to buy the larger Quinn Insurance (QIL) business.

A joint venture of Liberty and Anglo Irish Bank formally agreed to buy QIL last week.

The deal — which is set to go through in the next few months, following regulatory approval — will see Liberty take a 51% stake in QIL and pump €102 million into the business. QIL is set to be re-launched under a new name in the coming weeks.

The sale of Quinn Healthcare, which has traditionally been a strong cash generator for the Quinn Group, will form part of a shake-up of the Irish health insurance market, as VHI is also set for a radical overhaul that could result in the sale of certain elements.

The latter part of that process could see both IL&P and Aviva take notice.

In stark contrast to QIL — which last week announced that it made a total loss of €706m in 2009 and an estimated loss of €160m last year, adding that it will need to significantly tap into the state’s Insurance Compensation Fund — Quinn Healthcare (which includes the former operations of Bupa Ireland) is profitable. The asset could fetch up to €100m.

Regarding the QIL takeover, Anglo chief executive Mike Aynsley said the move represented the best way of maximising the recovery of Anglo’s Quinn-related debts, which are nearly €2.9bn.