Reports of Highmark wanting to sell vision unit raises questions

June 24--Is Highmark Health looking to sell its profitable HVHC vision business?

The Wall Street Journal says it is, but a Highmark spokesman would not confirm that and Pennsylvania Insurance Department officials say they have not received any notification from Highmark -- a requirement if an insurer intends to sell part of its holdings.

Highmark spokesman Aaron Billger described HVHC as "a strategic investment for Highmark" and said the Pittsburgh insurer is often contacted by others who may be interested in purchasing it or other non-core Highmark businesses.

As to whether Highmark is actively shopping HVHC, he said simply, "We are keeping our options open."

HVHC has two arms -- the VisionWorks retail chain and the Davis Vision-managed care insurance component.

On Thursday, Ronald G. Ruman, chief spokesman for the Pennsylvania Insurance Department, said that if Highmark was soliciting buyers for Davis Vision "then Highmark would have to notify us they are planning to have a change in the control of that company. That has not happened." In fact, he added, "We have not had any discussions with Highmark concerning any of its business units."

In 2015, HVHC, headquartered in San Antonio, Texas, recorded $1.5 billion in revenue with an operating profit of $122 million. The individual units performed well, too: Davis Vision's enrollment grew by 1.9 million to more than 22 million, according to Highmark Health's year-end financial report.

Visionworks, meanwhile, added 56 new stores in cities such as Detroit and New York City, giving it a total of 700 retail stores in 42 states, which showed a 5.3 percent increase in comparable store sales.

In October 2013, Highmark sold its wholesale eyewear unit, Viva Optique, to an Italian eyewear designer in a stock purchase agreement. Specific terms of the deal were not disclosed, although at the time Highmark officials said they had received a significant return on the business the insurer had purchased for $138 million in 2005.

Steve Twedt: [email protected] or 412-263-1963.

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