Lazard may snare Medibank Private mandate

Lazard's predecessor Carnegie Wylie conducted two previous studies on the potential privatisation of the health insurer.

Lazard Ltd may be in prime position to win the mandate to conduct the potential sale of Medibank Private, perhaps the first large-scale privatisation by the Abbott government.

Joe Hockey, now the Treasurer, said in 2010 the sale of Medibank Private could raise up to $4.5 billion. Medibank Private has reportedly had annual operating profits of about $200 million, most of which has been paid as dividends to the government.

The Howard government hired Carnegie Wylie to undertake two scoping studies of the health insurer in 2003 and 2006. Carnegie Wylie was acquired by Lazard in 2007, around the time then Prime Minister John Howard decided not to proceed with the sale of Medibank Private.

Another scoping study will have to be conducted on Medibank Private and that may settle on a potential valuation of the asset. The government will then have to decide whether to sell it to a buyer or conduct an initial public offering.

Lazard is currently advising the New Zealand government on the IPO of Meridian Energy Ltd. after earlier this year advising it on the IPO of Mighty River Power Ltd.

The firm is currently ranked number two on the Australian merger and acquisition league tables, according to Bloomberg data. It has a 12 per cent market share having worked on eight deals worth $6.91 billion.

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