New Zealand Government agency Commerce Commission has rejected an application from Connor Healthcare to buy all of the shares that it does not currently own in Wellington-based private hospital operator Acurity Health Group.

The proposed acquisition would have placed three out of four private hospitals in the Wellington region under the group’s ownership.

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If the deal was successful, Boulcott, Bowen and Wakefield would come under common ownership, leaving only Southern Cross Hospital independent of Connor Healthcare.

Commerce Commission chair Dr Mark Berry said: "Boulcott Hospital provides an important competitive constraint to the other hospitals in the Wellington region.

"The proposed acquisition would have placed three out of four private hospitals in the Wellington region under the group’s ownership."

"For medical insurance providers, the greater the number of hospitals they have to play off against each other, the more competitive the price they will achieve which ultimately benefits consumers.

"If the acquisition proceeded, insurers would have had one less option and for some procedures Connor Healthcare would have been the only significant provider in the greater Wellington region."

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The agency said it looked at surgical procedures including orthopaedic hips and knees, colonoscopy and gastroscopy.

Dr Berry said: "The greatest difficulty Southern Cross Hospital would be likely to face, apart from enough physical capacity, would be attracting sufficient specialists to its facilities to perform procedures."

Connor is 100% owned by Evolution Healthcare, which separately owns Boulcott Hospital in Lower Hutt, and Acurity’s other two major shareholders are the Stewart family and Royston Hospital Trust.