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Speculation emerges over potential Medibank Private sale

20 September 2011 - 2:41pm

Medibank Private is expected to post a record profit this year, leading some commentators to speculate over a potential sale.

The private health insurance giant remains under the ownership of the federal government, meaning that a sale could potentially bring in billions - particularly relevant in light of Labour's commitment to pull the budget back into surplus.

According to The Australian, Medibank Private currently holds more than a 30 per cent share of the private health insurance market, with a sale pitched between four and five billion dollars.

Independent minister Rob Oakeshott called on the government to sell the company last month, following debate over the means-test of the private health insurance rebate.

Oakeshott highlighted the ability of a sale to contribute to the budget, arguing in favour of that approach compared to changes to the rebate.

The Labour government currently has no pressing plans to sell off the health insurer, however the Liberals have said otherwise.

Due to its large customer base, the privatisation of Medibank Private would mean the creation of a bigger private market.

Reports have surfaced in the Sydney Morning Herald over managing director George Savvides' rumoured meetings with a number of broking firms - a potential sign that change is on the horizon.