Manchester -- The value of mergers and acquisitions (M&A) targeting companies based in Latin America, including tax havens, continued to build on the 22 per cent growth recorded in H2 2013 as dealmaking advanced by a further 9 per cent to USD 128,325 million in H1 2014, according to information collected by the leading M&A database Zephyr. M&A was supported by nine high value transactions, each worth USD 2,500 million or more, in H1 2014 and which together accounted for a quarter of the six month period's total value. However, volume failed to sustain the 12 per cent growth recorded in H2 2013 as dealmaking fell back to 1,141 transactions, representing a new low for the 11 periods under review.
Zephyr recorded six deals in the top 20 by value targeting Brazilian companies, representing 13 per cent of the total invested across the entire region for the period. These included 2014's largest Latin American deal to date, which was worth USD 6,287 million and involved Oi launching a rights issue and public offering to raise money to partially finance the Rio de Janeiro-based telecommunications company's proposed merger with Portugal Telecom, which agreed to subscribe for shares alongside investors and Banco BTG Pactual.
It comes as no surprise then that companies based in Brazil were the main targets by value in H1 2014 after M&A in the country rose 69 per cent to USD 39,695 million from USD 23,455 million in H2 2013. Similarly, for companies based in the Cayman Islands, value was up 23 per cent over the six months at USD 29,074 million from USD 23,697 million. However, increased M&A investment in countries such as Peru, Belize, Paraguay and Venezuela over the first half of the year came at the expense of Bermuda, Barbados and Panama, among others. Companies based in the Cayman Islands led by volume after M&A rose 5 per cent to 305 deals from 292 in H2 2013, compared to dealmaking involving Brazilian targets, which fell 23 per cent over the six months to 224 transactions (H2 2013: 291).
Lisa Wright, Zephyr director, commented, "The continued increase in Latin American M&A value is a welcome indication of recovery and represents the second consecutive increase since H1 2013's disappointing showing and making up for a decline in volume. The result was even more encouraging when combined with a slight increase in private equity value in the region, although volume also declined here."
The value of private equity and venture capital (PE/VC) investment targeting companies based in Latin America rose for the second consecutive period in H1 2014, advancing 5 per cent to USD 12,972 million, compared to H2 2013 when dealmaking doubled to USD 12,296 million (H1 2013: USD 6,100 million), according to Zephyr. PE/VC investment was propped up by three transactions each worth more than USD 1,000 million and which together accounted for 45 per cent of the period's total value.
The Zephyr database shows that while PE/VC value remained buoyant and at one of the highest levels recorded for the last 11 periods under review, the volume of PE/VC activity failed to sustain growth and fell back 35 per cent over the six months to 82 transactions from 126 in H2 2013 (H1 2013: 81).
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Notes to Editors:
The date range is 01/01/2014 - 29/06/2014 inclusive
Activity is based on the activity of the target company
Deal status is announced, completed, pending or unconditional
The sector breakdown uses targets' activities as defined to be 'Major Sectors' by Zephyr
The South and Central America region covers target companies in Anguilla (AI), Antigua and Barbuda (AG), Argentina (AR), Aruba (AW), Bahamas (BS), Barbados (BB), Belize (BZ), Bermuda (BM), Bolivia (BO), Brazil (BR), British Virgin Islands (VG), Cayman Islands (KY), Chile (CL), Colombia (CO), Costa Rica (CR), Cuba (CU), Curacao (CW), Dominica (DM), Dominican Republic (DO), Ecuador (EC), El Salvador (SV), Grenada (GD), Guatemala (GT), Guyana (GY), Haiti (HT), Honduras (HN), Jamaica (JM), Mexico (MX), Nicaragua (NI), Panama (PA), Paraguay (PY), Peru (PE), Saint Kitts and Nevis (KN), Saint Lucia (LC), Saint Vincent and the Grenadines (VC), Sint Maarten (SX), Suriname (SR), Trinidad and Tobago (TT), Uruguay (UY), Venezuela (VE)
Zephyr is an information solution containing M&A, IPO and venture capital deals and rumours with links to detailed financial company information. Zephyr covers various deal types including M&A activity, IPOs, joint ventures and private equity deals. It's published by Bureau van Dijk (BvD). The deals on Zephyr are linked to the company financials and peer reports on BvD's product range, which includes Orbis, Amadeus and Fame, for company valuation and benchmarking.
Zephyr contains information on over 1 million deals. Approximately 75,000 deals are added each year depending on levels of deal activity. Zephyr has no minimum deal value. All deal information is translated into English. Zephyr's UK-based researchers speak 30 languages and use native language and English sources in their deal enquiries.
About Bureau van Dijk
Bureau van Dijk (BvD) is one of the world's leading publishers of electronic business and company information. The company has over 30 offices worldwide. BvD is best known for its range of international company information products that combines multiple high-quality data sources with flexible software to allow users to manipulate data for research, marketing intelligence and analysis. Products include Fame, Orbis, Amadeus, Bankscope, Isis and Osiris. BvD also publishes the global M&A database, Zephyr.