Herbert Smith Freehills has advised the Commonwealth of Australia (Commonwealth) on the privatisation of Medibank Private Limited (Medibank) via an initial public offering and listing on the Australian Securities Exchange (ASX).

The offer consisted of an institutional offer, policyholder offer, employee offer, broker firm offer and general public offer (Offer). The final price payable by institutional investors was set by the Commonwealth at A$2.15, which values Medibank at approximately A$5.9 billion.

Medibank is Australia’s largest private health insurer with a 29.1% market share. Medibank’s core business is the underwriting and distribution of private health insurance policies through its two brands, Medibank and ahm. Medibank offers hospital cover and extras cover to customers in Australia as well as health insurance to overseas visitors and students. Medibank also participates in the broader healthcare industry through the provision of integrated healthcare services to policyholders, government, corporate and other customers.

Medibank shares commenced trading on ASX on 25 November 2014.

The Herbert Smith Freehills team was led by partners Philippa Stone, Brad Russell, Michael Ziegelaar, Natalie Bryce and Philip Hart, assisted by special counsel Rob Finlay, executive counsel Lauren Magraith, senior associate Lucy Hall and solicitors Thomas Cooper, Rowan Kellam, Alexander MacKinnon, Andrea Conn, Andrew Earle and Carlos Dias.

Ms Stone said: “We are delighted to have acted again for the Commonwealth on another historic privatisation transaction. The initial public offering of Medibank was the biggest capital markets transaction of the year and ranks as the largest IPO in Australia since Telstra 1 in 1997. It was a pleasure to advise the Department of Finance and to have the opportunity to work closely with such an exceptional group of people.”

Herbert Smith Freehills worked with the Department of Finance taskforce appointed to conduct the transaction. The Medibank IPO was overseen by Jan Mason, and the taskforce was led by John Edge supported by a team of 15 including Robert Higgins, Suzanne Pitson, Andrew Staines, Mary Giacca, Hamid Heydarian, Carly Makin and Stephen Sorbello.

Herbert Smith Freehills has worked with the Commonwealth on a number of significant privatisation transactions, including the landmark privatisation equity offerings for Telstra 1, 2 and 3, the A$5.58 billion trade sale of Sydney Airports and the previous scoping study for ASC Pty Limited (formerly Australian Submarine Corporation Pty Limited).

Herbert Smith Freehills’ capital markets team has also recently acted for Surfstitch Group Limited on its A$83m IPO, oOH!media Limited on its A$141m IPO, Healthscope on its A$3.6 billion IPO, SG Fleet on its A$449 million IPO, Genworth Financial on Genworth Australia’s A$1.6 billion IPO, Japara Healthcare Limited on its A$525m IPO, Regis Healthcare Limited on its A$485.8 million IPO, the PACT Group on its A$1.12 billion IPO, the McAleese Group on its A$166 million IPO, and for the joint lead managers on Mantra Group’s A$449m IPO, Spotless Group’s A$1.9 billion IPO, Asaleo Care’s A$657 million IPO, Veda’s A$1.05 billion IPO and OzForex Group’s A$439 million IPO, for the sole lead manager on National Storage REIT’s A$240 million IPO, for the joint lead managers on iSelect’s A$215 million IPO and for Calibre Group on its A$477 million IPO.

Herbert Smith Freehills’ Australian capital markets team has also recently acted for Paladin Energy Ltd on its A$205m  pro-rata accelerated non-renounceable entitlement offer with concurrent strategic placement, Arrium on its A$754 million pro-rata accelerated renounceable entitlement offer with retail rights trading, the sole lead manager on Aveo Healthcare Limited’s A$232 million entitlement offer, for the sole lead manager on ALS Limited’s A$246 million entitlement offer, for ASX Limited on its A$553 million entitlement offer and for Ten Network Holdings Limited on its A$200 million entitlement offer and its A$230 million entitlement offer.

The Offer was lead managed by Deutsche Bank AG, Sydney Branch, Goldman Sachs Australia Pty Ltd and Macquarie Capital (Australia) Limited (Joint Lead Managers). The Joint Lead Managers were advised by Clayton Utz.

Medibank was advised by King & Wood Mallesons.