Report of M&A market: Latin America – 2017

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Total transaction volume for the full year was up 3.1% in Latin America

  • LatAm Deal volume fell 8.5% in 4Q17
  • Aggregate deal value fell 41.5% to USD 30.4bn

Scope of the Latin American market

  • The total number of announced and closed transactions in Latin America fell by 8.5% in 4Q17 over 4Q16 to 538 deals, according to TTR data.
  • Aggregate transaction value fell 41.5% relative to 4Q16 to USD 30.4bn, considering 256 deals of disclosed consideration region wide.
  • Total transaction volume for the full years was up just over 3.1%, meanwhile, to 2,124 deals, though aggregate value slipped 22.2% to 100.8bn for the year, taking into account 931 announced and closed transactions of disclosed consideration across Latin America.

TOP SIX M&A MARKETS IN LATIN AMERICA

Latin America’s uncontested leader in M&A, Brazil dominated deal flow regionally in 2017 with 1,095 transactions together worth USD 61bn, up 6% by volume and 7% by aggregate value compared to 2016. There were 482 announced and closed transactions of disclosed consideration in Brazil contributing to aggregate value in 2017.

Mexico follows with 302 deals worth a combined USD 18.3bn, on par by volume relative 2016 and down 40% by aggregate value, taking into account 144 deals of disclosed consideration.

Chile ranks third regionally, its 242 deals in 2017 together worth USD 12.8bn, up 11% by volume and down 9% by aggregate value over 2016, taking into account 105 transactions of disclosed consideration.

Argentina ranks fourth in Latin America for the year with 217 announced and closed deals worth a combined USD 5.3bn, up 5% by volume and down 70% by aggregate value, considering 97 transactions for which a deal value was disclosed to the end of the year.

Colombia follows in fifth place regionally with 168 deals for the year, down 1% over last year. Aggregate deal value fell 86% to USD 3.3bn, taking into account 68 transactions of disclosed consideration.

Peru rounds out the top six M&A markets in the region, its transaction volume down 13% to 130 deals, its aggregate deal value up 10% to USD 6.4bn relative to 2016, taking into account 64 transactions of disclosed consideration.

CROSS-BORDER DEALS

Bidders based in Latin America made 13 extra-regional cross-border acquisitions in 4Q17, five targeting companies in North America, and eight with targets in the EU.

North American buyers topped inbound acquisitions in the region during the quarter, with 63 deals originating from the US and Canada. EU-based acquirers made 50 inbound deals, Asian buyers 10, African companies two and Australian bidders two as well.

DEAL OF THE QUARTER

TTR selected the IEnova’s USD 231m acquisition of a 50% stake in Ductos y Energéticos del Norte from Pemex Transformación Industrial as Deal of the Month in November and Deal of the Quarter. The Mexico City-based pipeline operator was advised by Mijares, Angoitia, Cortés y Fuentes, while the state-held oil company subsidiary used DLA Piper Gallástegui y Lozano Mexico as legal advisor and BBVA Bancomer as financial advisor.