(Reuters) -UnitedHealth Group said on Friday it had agreed to sell its operations in Brazil to the founder and former CEO of health insurance firm Qualicorp José Seripieri Filho.
Last week, two sources had told Reuters about the sale of UnitedHealth (NYSE:UNH)'s Brazilian health insurance operator Amil to Seripieri, who left Qualicorp in 2019. One of the sources had said Seripieri's bid was around 2.5 billion reais ($515.24 million).
In a regulatory filing on Friday, UnitedHealth said it will record a $7 billion charge related to the sale, a majority of which is non-cash and is being recorded due to foreign currency translation losses.
The charge will not impact UnitedHealth's adjusted earnings in 2024, the company said, confirming its adjusted profit forecast of $27.50 to $28.00 per share initially provided in November. UnitedHealth will report fourth-quarter 2023 results on January 12.
"We believe this agreement will ensure ongoing success, working with a buyer who has the local knowledge and experience to continue the positive momentum of the business," said UnitedHealth in an emailed statement.
UnitedHealth did not provide financial details about the transaction.
The healthcare firm said the sale includes Amil Insurance, Amil Integrated Care, Amil Dental and Americas Hospitals in Brazil.
Amil has 5.4 million health and dental insurance beneficiaries in Brazil and its sale was in the making for years, according to a Reuters report.
UnitedHealth CEO Andrew Witty announced the decision to sell Amil, acquired in 2012 for $5 billion, soon after taking the helm in 2021.
The company had previously struggled to sell its Brazilian unit due to antitrust issues and growing losses from individual health plans. It had suspended a sale process for Amil last year, according a Reuters report.
($1 = 4.8521 reais)