FILE PHOTO: The corporate logo of the UnitedHealth Group appears on the side of one of their office buildings in Santa Ana, California, U.S., April 13, 2020. REUTERS/Mike Blake/ File Photo

By Tatiana Bautzer and Sabrina Valle

NEW YORK (Reuters) -UnitedHealth Group is weighing multiple bids for its Latin American operations, according to two people with direct knowledge of the matter, as the insurer buckles down after a series of unprecedented missteps that include the ouster of its CEO and a reported criminal accounting probe.

The largest U.S. health insurer has been trying to exit Latin America since 2022, but the sale of Banmedica has taken on increasing urgency in recent months as the insurer took hits on multiple fronts, according to one of the people.

New CEO Steve Hemsley told shareholders last week that he was determined to earn back their trust after an earnings miss and a Wall Street Journal report that the company was under criminal investigation for alleged Medicare fraud. UnitedHealth has said it was not notified by the Department of Justice and that it stands by the integrity of its operations.

Hemsley replaced Andrew Witty just a few months after the murder of the executive Brian Thompson, the CEO of UnitedHealthcare, in New York in December while on his way to a meeting with investors. Witty had been UnitedHealth Group CEO since 2021.

The company has four non-binding bids for its Banmedica subsidiary, which operates in Colombia and Chile, for about $1 billion, according to both people, who asked not to be identified because the talks are private.

UnitedHealth's shares tumbled 25.5% in May alone and year-to-date are down 40%. UnitedHealth left Brazil in 2023 and Peru in March. It's aiming to get around $1 billion for Banmedica's operations in Colombia and Chile, the people said.

The two people said the company expects to set a deadline for binding proposals as soon as July.

UnitedHealth received bids from Washington, D.C.-based private equity firm Acon Investments; Sao Paulo-based private equity firm Patria Investments; Texas non-profit health firm Christus Health; and Lima-based healthcare and insurance provider Auna, the people said. Auna is in talks with a financial partner, one of the sources added.

Banmedica's annual earnings before income taxes, depreciation and amortization, or EBITDA, are more than $200 million a year.

Patria, UnitedHealth Group and Christus Health declined to comment. Acon and Auna did not respond to requests for comment.

FAILED EXPANSION PLANS

UnitedHealth bought Banmedica in 2018, with CEO David Wichmann saying he was "establishing a foundation for growth in South America for the next decades."

At the time, UnitedHealth paid around 12 times Banmedica's EBITDA, according to one of the people. Three years later, the insurer decided to leave Latin America as it grappled with losses in its largest operation in the region, Brazil's Amil, which had been acquired a decade earlier. It divested from its Brazilian operations in late 2023.

Banmedica is currently profitable, but is considered too small by UnitedHealth. It serves over 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.

UnitedHealth booked an $8.3 billion loss last year related to the sale of its South American operations - $7.1 billion stemming from the Brazil exit and $1.2 billion from Banmedica.

"These losses relate to our strategic exit of South American markets and include significant losses related to foreign currency translation effects," the company said in a February filing.

Brazilian investment bank BTG Pactual is advising UnitedHealth on the sale.

(Reporting by Tatiana Bautzer and Sabrina Valle; Editing by Leslie Adler)