Tribunal approves Metropolitan Health / CareCross Health merger
The Competition Tribunal has unconditionally approved the large merger involving Metropolitan Health (Pty) Ltd (Metropolitan Health) and CareCross Health (Pty) Ltd.
Metropolitan Health is a subsidiary of MMI. MMI is a South African-based financial services group listed on the South African stock exchange. The core businesses of MMI are long and short term insurance, asset management, savings, investment, healthcare administration and employee benefits, and these services are offered through operating brands like Metropolitan and Momentum. Through its subsidiaries, Metropolitan Health also provides a suite of medical scheme administration and healthcare-related IT services and managed care services to manage the health risk of scheme beneficiaries to employer-based medical schemes in South Africa.
CareCross is the group parent company and was founded in 2000. CareCross and one of its subsidiaries, OneCare, are accredited by the Council for Medical Schemes as managed care organisations. There are presently 40 accredited managed care organisations in the country. CareCross and OneCare provide primary managed healthcare services to medical schemes while OCSA provides occupational health and wellness services to large employers.
In terms of the proposed transaction, Metropolitan Health will acquire CareCross (and certain of its subsidiaries). Following its investigation, the Competition Commission found that although the proposed transaction gave rise to certain horizontal overlaps and vertical integration; the proposed transaction did not raise significant competition concerns, given that CareCross will continue to operate independently from the operations of Metropolitan Health (including its subsidiary companies). As such, the proposed transaction did not lead to a substantial lessening of competition. In addition, the merger did not raise any public interest concerns. The Tribunal unconditionally approved the merger.