LatAm M&A prepares to pick up in 2019
December 17, 2018 |
Deal flow could rise around 10% next year, pushed by more deals in Brazil, Chile and Colombia
M&A activity in Latin America could rise around 10% to $78bn in 2019, fueled by more deals in Brazil and a promising pipeline in Colombia and Chile, LatinFinance has heard.
"The M&A market has been choppy this year, but we are optimistic that things will improve in Brazil, where companies are deleveraging and poised to do strategic deals," said a banker in New York.
Deal flow could also grow in Colombia and Chile, particularly in the infrastructure, oil and gas and power utility sectors, the banker said.
The picture is less rosy in Mexico, where investors appear unnerved by the left-leaning economic policies of President Andrés Manuel López Obrador, who took office on December 1.
"We were optimistic about Mexico, but now we are taking a wait-and-see approach," the banker said. "It's about the [energy] reforms," he said, adding that some deals could go through in the retail and food distribution sectors.
According to Dealogic, M&A activity in Latin America will decline 20% to $71bn from 766 transactions in 2018, compared to $108bn from 969 transactions in 2017.