The total value of M&A transactions in Latin America was up 14% in the first half of 2013 compared with the same period in 2012, according to data from financial analyst S&P Capital IQ. The growth was particularly strong in sectors such as 'consumer discretionary', energy (both traditional and renewable) and financial services, which were up a respective 83%, 66% and 50%. Pavle Sabic, application specialist at S&P Capital IQ, said: “In some instances, Latin America's M&A has been growing faster than the Middle East, Africa and Europe.”
Mexico, Colombia and Panama are among the countries that recorded large increases in the number of M&A deals. However, Brazil remains the leading destination for M&A transactions in the region. In the first six months of 2013, Brazil secured 228 new deals worth an estimated $ 13bn, which was 36% higher than the combined value of M&As secured by Mexico, Colombia and Panama.
Interestingly, however, the biggest deal of all was sealed in Mexico. In June, US-based wine giant Constellation Brands acquired Compania Cervecera de Coahuila, a Mexican brewery, for $2.9bn.
The total value of top five Latin American M&A deals of the first six months of 2013, at $12.6bn, was 36% lower than the same period of 2012. And while in the whole 2012 there were 14 deals worth $1bn or more, the first six months of 2013 has seen eight such deals in the region. Additionally, according to S&P Capital IQ's analysis, when all deals announced or closed in the first half of 2013 are concerned, the average size of the deal value is up 5% from the same period in 2012. “Disclosed deal values are generally small, relative to the rest of the developed world. However, average deal value has picked up since 2012 lows,” said Mr Sabic.
Last year’s deal count was the highest for Latin American M&A since the crisis. “The biggest deals in 2012 were in the second half of 2012. If this trend were to continue in 2013, there could be a strong close to the year,” said Mr Sabic.