UnitedHealth Group is considering multiple bids for its Latin American operations, Reuters reported Monday.
The company has four nonbinding bids for its Banmédica subsidiary, which operates in Colombia and Chile, for about $1 billion, Reuters reported, citing two people with direct knowledge of the matter.
The health insurer has been trying to exit Latin America since 2022, according to the media outlet. But selling off its operations in Colombia and Chile may now have more urgency as the healthcare giant confronts a series of financial challenges and negative headlines in the U.S.
In 2023, UnitedHealth Group agreed to sell off its Brazilian health insurance business, Amil, to entrepreneur José Seripieri Filho, according to a filing submitted to the Securities and Exchange Commission at the tail end of 2023. UnitedHealth completed that sale in February 2024 and booked a $7.1 billion loss in 2024, the company said in a January filing for its full 2024 fiscal year financial performance.
The company initiated a plan to sell its remaining South American operations in the second quarter of 2024. UnitedHealth recorded a loss of $1.2 billion last year stemming from Banmédica.
“Following the sale of our much larger Brazil operations, we classified the remaining South American businesses as held-for-sale This is a natural step following the Brazil sale. In a diverse enterprise, with a strong growth record and capabilities such as ours, such portfolio evolutions enable us to keep our focus on the many compelling growth opportunities before us," a UnitedHealth Group spokesperson said in a statement to Fierce Healthcare.
UnitedHealth’s push into South America began in 2012 when it acquired Amil, Brazil’s largest healthcare company. It bought Banmédica for a reported $2.8 billion in 2018. At the time, UnitedHealthcare Global CEO Molly Joseph said acquiring Banmédica would put UnitedHealth in a "leading position" in four of South America’s largest economies.
During an earnings call in January 2018, UnitedHealthcare CEO Steve Nelson said the expansion opportunities in South America are “reminiscent of the opportunities in healthcare markets in the U.S. two decades ago,” when both Medicare Advantage and Medicaid managed care were in their infancy.
“We expect opportunities for growth in these markets to advance, as they have in the past two decades or more in the U.S.,” he said.
The company is aiming to get about $1 billion for Banmédica's operations in Colombia and Chile, Reuters reported, citing its sources, and a deal may be reached this summer.
According to Reuters, UnitedHealth received bids from Washington, D.C.-based private equity firm Acon Investments, Sao Paulo-based private equity firm Patria Investments, Texas nonprofit health firm Christus Health and Lima-based healthcare and insurance provider Auna.
Banmédica serves more than 2.1 million consumers through its health insurance programs and has around 4 million patient visits annually across its network of 13 hospitals and 143 medical centers, Reuters reported.