Global Capital Dominates Brazilian Tech M&A Landscape in 2023

Financial transactions within the tech sector, particularly the acquisition of fintech firm Pismo by Visa, underscored this trend.

This deal alone accounted for nearly one-third of the sector’s M&A investment, marking a pivotal moment for industry consolidation and growth.

RGS Partners’ “M&A Brazil Reports” highlighted an uptick in cross-border activities, with international buyers accounting for 47% of all transactions, up from 43% the previous year.

This rise was even more pronounced in the tech sector. The Brazilian market’s relative infancy and limited capital access paved the way for foreign entities to play a dominant role.

According to Fábio Jamra, a partner at RGS, transactions exceeding R$1 billion ($200 million) typically attract financial buyers due to the local investors’ scale limitations.

Although foreign involvement constituted 67.5% of the tech deals by number, they represented a staggering 90% of the financial volume, up from 72% in 2022.

Noteworthy deals included Visa’s acquisition of Pismo for R$ 4.8 billion ($960 million).

Evertec purchased Sinqia for R$ 2.98 billion ($596 million), and General Atlantic invested R$ 1 billion ($200 million) in QI Tech.

These transactions showcased the sector’s vibrancy and appeal to global investors.

The report focused on transactions above R$50 million ($10 million), categorizing Brazil-based foreign funds as cross-border investments.

Jamra observed a balanced dynamic between financial and strategic investors.

This highlights ongoing confidence in technology and its transformative potential for companies undergoing digital shifts.

Technology sector leads in deal volume but ranks fifth in transaction value, signaling a trend toward early-stage and mid-sized acquisitions.

Tech’s role amid consumer, healthcare, and commodity market changes paints Brazil’s evolving economic landscape.