RIO DE JANEIRO, BRAZIL – Mergers and acquisitions in Brazil reached, in 2021, the highest value since 2010, according to a report by consultancy Bain & Company released on Tuesday, February 8. In all, US$66 billion (about R$344 billion) were moved.
According to the study, most of this result is linked to the large volume of initial public offerings (IPOs), and a macroeconomic context that favored these operations, with a low-interest rate and the dollar appreciated against the real.
The report points out that large transactions worth more than R$10 billion accounted for about 50% of the total value of transactions in 2021. Most of them were focused on consolidation in sectors.
Among the examples that the report brings is the merger between Hapvida and NotreDame Intermedia in the health care area and the purchase of Biosev by Raízen in the energy area. In the transportation sector, Localiza merged with Unidas, while Carrefour acquired the BIG group in retail.
The number of deals in the technology sector has doubled since 2016, but according to the report is equivalent to about 30% of total deals and accounted for 5% of the total value in 2021.
The consultancy also highlights that in 2021, the number of IPOs reached a record volume, with 46 deals, moving R$64 billion, an amount higher than the historical high recorded in 2020.
According to the report, the positive scenario was influenced by macroeconomic factors in the year, with high liquidity and lower interest rates, but also by the number of investors in the Brazilian market who started to seek higher returns in the capital markets.
The study points out that many Brazilian companies that held IPOs in 2021 reported their intention to use at least part of the funds raised in this process to make acquisitions.
According to Bain & Company, this occurred in 50% of the companies, and 61% of the members of this group effectively carried out acquisition operations until the beginning of 2022. It suggests that new purchases may occur throughout the year for the consultancy.
Besides the generation of capital with IPOs that can be used for mergers and acquisitions, the consulting firm cites in the report the government agenda of selling assets controlled by the public power, citing the concessions in the area of sanitation in states such as Alagoas, Amapá and Rio de Janeiro, which represented about R$30 billion.
Airport concessions totaled R$3.3 billion, while the sale of refineries by Petrobras moved R$9.1 billion.
For 2022, the consultancy highlights the privatization of Eletrobras, the auction of eight port terminals, including in the Port of Santos, and new sanitation auctions.
Still, for this year, the consultancy estimates that mergers and acquisitions should remain heated, but warns that the environment may be negatively impacted by global supply and demand shocks, uncertainties with the pandemic and the presidential elections, and a bad macroeconomic performance of Brazil, with high-interest rates and inflation.
Globally, mergers and acquisitions also hit a record high in value in 2021, totaling $5.9 trillion, in a year of recovery after a poor performance in 2020 with the pandemic.