Publish in Special Reports - Wednesday, January 11, 2017
China-based State Grid’s $7.7 billion purchase of Brazilian electricity giant CPFL became Latin America’s largest deal last year, according to new Thomson Reuters data. (Photo: CPFL)
Paola Lozano, head of Skadden's Spanish language corporate practice; Paul Schnell, Chair of the firm's Latin America practice; Skadden Sao Paolo Head Mathias von Bernuth and Sao Paulo Partner Filipe Areno.
China and Brazil top Latin America’s top 100 mergers & acquisitions.
BY JOACHIM BAMRUD
China-based State Grid’s $7.7 billion offer for remaining shares in Brazilian power distributor CPFL became the largest announced merger and acquisition in Latin America last year, while the $3.7 billion purchase for two Brazil hydro-projects by China Three Gorges ranked among the top six M&As, according to the ranking of top 100 deals from Latinvex and Thomson Reuters.
The total value of announced mergers and acquisitions involving Latin America and the Caribbean reached $151 billion last year, an increase of 16.6 percent from 2015, Thomson Reuters data shows. Of that, Latin America and Caribbean companies as targets accounted for $104.2 billion, an increase of 12.6 percent.
While declining in Mexico by 66 percent, the value of announced M&As in Brazil jumped 21 percent. Meanwhile, Argentina, Chile and Colombia saw triple-digit increases in announced M&As.
However, this year is marred by a significant degree of uncertainty, experts warn.
“I've rarely seen more uncertainty about economic and political prospects across Latin America than today, and that in turn creates tremendous uncertainty for M&A in the region, although there will be areas of where deal activity can be strong,” says Paul Schnell, chair of the Latin America practice at Skadden, the top US law firm in announced M&As in Latin America last year.
The uncertainty surrounding U.S. trade, tax, foreign investment and other policies is likely to...
Keywords: Argentina, Brazil, Chile, Colombia, Corruption, Ecuador, Mexico, M&As, Peru, Skadden