MORE than 300 jobs have been saved and competition in the health insurance market has been preserved after Quinn Healthcare was sold to a group of local managers in Cork, backed by the giant insurer Swiss Re.
Four managers have bought the business for an undisclosed sum from the Quinn Group and they hope to provide strong competition to the two other operators -- VHI and Aviva.
All 334 jobs at the company, based in Little Island, Cork, will be retained and while the firm intends to change its name, none of the changes should impact on current policyholders.
In November there were fears that Quinn Healthcare would simply be merged with VHI, under plans by Health Minister James Reilly.
However, Dr Reilly's plans went nowhere and the local management team pressed on with their own proposals, which involved a tie-up with Swiss Re.
Swiss Re, which has $228bn (€175bn) of assets and more than 10,000 employees, is putting up €150m as a cash reserve to stabilise the business and it will do all the underwriting of insurance policies issued by the company. It is understood Quinn Healthcare is profitable.
As first reported in the Irish Independent, the Financial Regulator and the Health Insurance Authority have both been studying the deal for weeks and are expected to sign off on the transaction in January.
Major reductions in premiums are not likely to result from the deal and Quinn recently put through a set of premium rises. Quinn Healthcare has a younger customer profile than VHI, so the amount of claims it pays out are lower, which is likely to have been attractive to Swiss Re.
The four managers who have bought the business in a management buyout (MBO) are believed to be Donal Clancy, managing director of Quinn Healthcare, Mary Condon, the director of finance and two other executives, Dermot O'Connor and Brenda Ryan. The terms of the MBO are not known.
Mr Clancy said: "This is great news for our members and the Quinn Healthcare team alike. Since the company was acquired from BUPA in 2007, it has operated as a largely independent entity. This independence will be further confirmed by the sale to members of the management team."
Local TD and opposition health spokesman Billy Kelleher (FF) said the news was "a tremendous morale boost for the local economy".
"These are critical jobs for both the Cork and Irish economies -- and, hopefully, this development will see the firm going from strength to strength and creating further employment in the future," he said.
"This announcement is very timely given that these workers were very concerned about their futures for some time.
"They can now look to the new year with confidence." he added.
Quinn Healthcare was part of Sean Quinn's attempt to take on the big players in the insurance market.
Since 2007, Quinn Healthcare has been steadily building up its customer numbers, but when its ultimate owner, the Quinn Group, got into debt trouble in the past year its future was placed in doubt.
When Quinn Insurance went into administration, the speculation increased even further as it was the underwriter for Quinn Healthcare.
Mr Quinn was reported to have bought BUPA's Irish operations for €150m.