Brazilian M&A Market Surges to R$195 Billion in 2024

The Brazilian mergers and acquisitions (M&A) market has shown remarkable growth in 2024. By early October, announced M&A deals reached R$195 billion ($34.8 billion), a 56% increase compared to the same period last year.

This figure surpasses the entire 2023 volume of R$117 billion ($21 billion). The number of completed transactions has also risen significantly.

So far, 531 deals have been finalized in 2024, just 62 shy of the total for 2023. This uptick in activity suggests a robust recovery in the M&A sector.

Several key industries have driven this growth. Infrastructure and oil and gas sectors have seen major agreements in recent weeks. The agricultural sector is also expected to boost transactions as many companies undergo restructuring.

Notable recent deals include Prio’s acquisition of the Peregrino and Pitangola oil fields. The French company CMA CGM purchased control of Santos Brasil for R$6.3 billion ($1.13 billion).

V.tal, BTG’s fiber optic company, bought Oi’s fiber broadband customer portfolio for R$5.7 billion ($1.02 billion). The largest transaction of the year was AES’s sale to Auren for approximately R$16.5 billion ($2.95 billion).

Despite this improvement, the current figures still lag behind the record-breaking years of 2021 and 2022. Anderson Brito, director of UBS BB, notes increased activity from private equity funds.

These funds are both selling mature investments and acquiring new assets. Brito also observes growing interest from foreign investors in Brazilian acquisitions.

The growth in M&A activity comes after a weak 2023 when many deals were put on hold. Diogo Aragão from Bank of America explains that the current increase reflects previously stalled transactions now moving forward.

Brazilian M&A Market Surges to R$195 Billion in 2024

Banks expect better results from M&A activities starting next year. Felipe Thut of Bradesco BBI anticipates a stronger pipeline entering 2025 compared to 2024. The anticipated decline in U.S. interest rates is seen as a positive factor for the market.

Industry consolidation has been a key driver of deals. Roderick Greenlees of Itaú BBA highlights mergers like Soma with Arezzo and Petz with Cobasi as examples of companies seeking synergies. Consumer goods, retail, and food sectors are particularly active.

While the current M&A market shows improvement, experts project an even stronger first half of 2025. As global economic conditions stabilize and interest rates potentially decrease, the Brazilian M&A market appears poised for continued growth and activity.

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