The Australian Competition and Consumer Commission will oppose the bid by Medical Imaging Australasia to acquire Benson Radiology, Acting ACCC Chairman, Mr Sitesh Bhojani, said today.
Benson Radiology is one of three main private radiology practices operating in the Adelaide region along with Perrett Medical Imaging and Dr Jones & Partners. MIA is already the owner of another Adelaide based private radiology practice in Perrett Medical Imaging.
In February this year, MIA approached the ACCC regarding the possible acquisition of Benson Radiology.
"The ACCC has conducted extensive market inquiries into this proposed acquisition, consulting with public and private hospitals, government agencies as well as private health insurance funds.
"Overall, the ACCC found that the proposed acquisition would lead to a substantial lessening in competition for the provision of radiology services to private patients in the Adelaide region.
"The proposed acquisition would have given MIA a market share in excess of 50 per cent for private patients in Adelaide.
"The ACCC was concerned that barriers to entry for the provision of radiology services are high.
"The ACCC found during the course of market inquiries that there was limited competitive overlap between private radiology practices and public hospital radiology departments. On this basis, the ACCC believe it is unlikely that public hospital radiology departments would provide an effective competitive constraint against the conduct of the merged entity.
"Ultimately, the ACCC was concerned that the proposed acquisition by MIA would result in higher prices for the provision of radiology services for private patients in Adelaide. On this basis, the ACCC has decided to oppose this acquisition".