BOGOTA (Reuters) - Grupo Sura SIS.CN, the Colombian investment holding company, will invest $150 million in 2018, principally in its insurance and pension interests in Latin America, its vice president for finance said.
The company plans to reduce its debt over the next two to three years, Ricardo Jaramillo told Reuters in a telephone interview late Tuesday, after spending around $9 billion buying up assets during the last decade.
The company, which has interests in 11 countries, is not ruling out further acquisitions, Jaramillo said, but will be more “selective.”
“We’re permanently getting alternatives for possible acquisitions, but we don’t have anything on the table today that we can talk about, though we always have new possible investments on the radar,” he said.
“From an investment standpoint, we’re talking about $150 million in insurance businesses, of Sura Asset Management and Grupo Sura,” Jaramillo said, adding that investments in further acquisitions would be in addition to that figure.
The $150 million will not include the company’s investments in bank Bancolombia BIC.CN, Grupo Argos’ ARG.CN cement and energy holdings or food producer Nutresa NCH.CN.
Grupo Sura’s net profit was down 13 percent in 2017 from a year earlier to 1.45 trillion pesos ($508.7 million), the company said earlier Tuesday.
Grupo Sura is looking to reduce its debt to between 10 percent and 12 percent of its loan to value portfolio from 15 percent within two to three years, and is not planning to issue any bonds, Jaramillo said.
“It’s in our interest to reduce that leverage by a bit to generate a bit more financial flexibility,” he said.
Coming elections in Colombia and Mexico could cause momentary uncertainty for businesses, Jaramillo added, but are not likely to have any deep effects because there is so much growth potential for insurance.
Grupo Sura is likely to see increased profit, Jaramillo said, allowing for any market ripples on the company’s 30 trillion pesos in investments.
“In our budget it’s clear we’ll increase our profit,” he said. “However there are a series of variables, as with 2017, that are hard to predict - exchange rates in some cases and also financial markets.”
Reporting by Nelson Bocanegra; Writing by Julia Symmes Cobb; Editing by Jeffrey Benkoe