US based health insurer UnitedHealth has entered into an agreement with Brazil’s Amil Participações, pursuant to which 90% of the 359 million outstanding common shares of the latter is likely to be purchased for approximately $4.9bn in cash.

As per the merger agreement, the purchase will be completed in two parts with UnitedHealth to buy nearly 60% of the outstanding shares from controlling shareholders and management in the first step.

In the second part, the company will move towards a tender offer during the first quarter of 2013 to acquire almost 30% stake from the public shareholders of the firm.

Amil’s founder, Dr Edson Bueno, and his partner, Dr Dulce Pugliese, will retain the outstanding 10% stake for at least five years and will invest $470m in UnitedHealth shares during the period.

Bueno will remain with the company as chairman and CEO, said the acquirer.

Brazil’s average GDP per capita is growing at a compound annual rate of 19.4% since 2003, almost 2.5 times that of China, resulting high demand for private health care coverage in the country.

Amil owns a network of 22 hospitals and nearly 50 clinics as well as care network of 44,000 doctors, 3,300 hospitals, nearly 11,000 outpatient clinics and 12,000 ancillary service facilities in the country.