Last week, the chairman of the Quinn group, Sean Quinn, announced that he would proceed with plans to takeover the 475,000 subscribers of Bupa.

This is despite health minister Mary Harney passing emergency legislation last week to close off a loophole which would have given Quinn a three year derogation from paying the VHI millions in risk equalisation payments.

Quinn said that he was "baffled and dismayed" by Harney's move.

But in what the VHI described as an "extraordinary" statement last week, Sean Quinn offered to takeover the VHI business to end the impasse over risk equalisation payments.

Quinn, who has already announced a price freeze for 2007, accused the VHI of charging "far too much for their products".

He added: "We will accept transfers from VHI and expect that in 95% of cases we will reduce people's bills while providing them with immediate cover."

Without facing up to Quinn directly on premiums, the state insurer responded, stating: "VHI healthcare is a membership based organisation which is not for sale nor do we purchase members.

"VHI healthcare premiums are simply set to to cover the cost of our members' healthcare needs. We will pay out 1bn in claims in the current financial year."

Meanwhile, Sean Quinn also assured the 300 employees of Bupa that he was committed to Fermoy. "I and my colleagues went down to Fermoy last week and took them out to dinner, " said Quinn, who pleaded with people to move their business over and give "a clear message to the VHI".