By Robb M. Stewart
MELBOURNE, Australia--Australia's government appointed three
banks to help manage the sale of the country's largest health
insurer and raise as much as 4 billion Australian dollars (US$3.75
billion), the first in an ambitious program of state-owned asset
sales.
Finance Minister Mathias Cormann on Thursday said Deutsche Bank
AG, Goldman Sachs Australia and Macquarie Capital were selected
from 11 bids to act as joint lead managers for the initial public
offering of Medibank Private.
The IPO is planned for the financial year beginning in July,
although the precise timing and structure of the deal have still to
be determined.
The federal government has ambitions to raise up to A$130
billion to help close a budget deficit and fund new infrastructure
such as airports from the sale of state assets ranging from ports
to electricity networks to the Australia Post mail service.
Mr. Cormann said in a statement that further managers for the
sale could be named later, and the government would appoint
companies nearer to the IPO that would assist the sales syndicate
and focus on retail selling roles. The government also has extended
the contracts of advisers for the IPO, including with financial
advisory firm Lazard Pty. Ltd., legal firm Herbert SmithFreehills,
accountants Ernst & Young, and Newgate Communications.
Medibank Private has 3.8 million members and had a profit of
A$315 million last year. It has around 30% of the Australian
health-insurance market, topping rivals such as NIB Health Funds
Ltd. and HCF, which have 900,000 and 500,000 members,
respectively.
Governments around the world are weighing asset sales to plug
holes in their budgets as tax revenues fall. Last year, the U.K.
sold the majority of its interest in state postal service Royal
Mail through an IPO in London, raising more than GBP1.7 billion
(US$2.86 billion). New Zealand's conservative government also has
raised billions of dollars with the sale of stakes in power
generators and national flag carrier Air New Zealand Ltd. in an
effort to return its budget to surplus by 2015.
Write to Robb M. Stewart at robb.stewart@wsj.com
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