Quarterly M&A Activity Report. Latin America, Q1 2016

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2 The following report details mergers and acquisitions activity in Latin America in Q using data from the Zephyr database. It focuses on deal activity by target company. Click here to access the raw data in an Excel spreadsheet. Latin America M&A continues to weaken The volume and value of mergers and acquisitions (M&A) targeting companies based in Latin America, including tax havens, declined for the third consecutive quarter in Q as a loss of investor appetite for dealmaking in the region led to a lack of megadeals worth USD 10,000 million or more over the quarter. There were only four deals targeting companies based in Latin America worth USD 2,000 million or more in Q1 and together they accounted for 29 per cent of the regions overall M&A value for the quarter. There were 480 deals worth a total of USD 39,286 million for the three months under review, representing a 28 per cent decline by volume and 46 per cent by value from 666 deals valued at USD 72,860 million in Q In a year-on-year comparison, volume slipped 27 per cent (Q1 2015: 660) while value halved from USD 78,565 million. Latin America deals by volume and value Announced date No of deals Q ,286 Q ,860 Q ,473 Q ,530 Q ,565 Q ,099 Q ,532 Q ,985 Q ,800 Total deal value Page 1

3 Latin America deals by volume and value 100, , Deal value 80,000 70,000 60,000 50,000 40,000 30,000 20, , Q Q Q Q Q Q Q Q Q Total deal value Number of deals Page 2

4 There are several countries in Latin America that are commonly known as tax havens due to their lenient regulations which make them desirable hubs to conduct business. Understanding that the figures in these countries are likely skewed due to their appealing regulatory environments, the table on this page only includes data from the following tax haven countries: Bahamas, Bermuda, British Virgin Islands, Cayman Islands. Tax haven deals by volume and value Announced date No of deals Q ,756 Q ,365 Q ,130 Q ,594 Q ,959 Q ,410 Q ,861 Q ,222 Q ,865 Total deal value Page 3

5 CITIC deal is top by value in Q1 The largest deal by value targeting companies based in Latin America was Chinese conglomerate CITIC streamlining its operations by agreeing to sell almost all of its residential property in the mainland to China Overseas Land and Investment in a deal worth USD 4,777 million. The deal comprises CITIC handing over CITIC Real Estate of China and Tuxiana of the British Virgin Islands and while it is not receiving cash for the divestment, CITIC is acquiring a 10 per cent stake in China Overseas Land and Investment along with a transfer of property portfolios. There was only one top 20 deal by value which featured a target based outside a tax haven and that was the acquisition of Brazilian online road toll electronic payment services provider Servicos e Tecnologia de Pagamentos by FleetCor Technologies for US 1,148 million. Cayman Islands companies main targets of M&A Eight of the quarter s top 20 deals featured a Cayman Islands target and together they accounted for 60 per cent of the overall USD 15,293 million-worth of M&A recorded for companies based in the tax haven in Q1. While value was stripped away over the three months (Q4 2015: USD 34,810 million), it actually improved year-on-year, rising 5 per cent from USD 14,563 million in Q PE and VC value advances year-on-year Private equity and venture capital (PE and VC) investment targeting Latin American companies was stripped away in Q1 as volume fell back 22 per cent to 51 deals from 65 in Q while value slumped by two thirds to USD 4,346 million. However, in monetary terms the decline is starkly highlighted as the USD 12,955 million-worth of deals recorded for Q4 2015, which was supported by a USD 9,300 million institutional buyout, is actually the highest recorded since Q In a year-on-year comparison, PE and VC volume slipped 41 per cent from 86 deals but value returned to the region (Q1 2015: USD 3,371 million) as PE and VC investment in Q1 was bolstered by two deals each worth more than USD 1,000 million. The largest PE and VC deal by value targeting a company in Latin America was Cayman Islands-based Uber China raising USD 2,000 million from investors ranging from CITIC Securities and China Minsheng Banking to China Vanke. I Squared Capital backed the second largest deal for the quarter, which was the institutional buyout of Viridian Group Holdings for USD 1,120 million. Together these two deals accounted for 82 per cent of the quarter s overall USD 3,788 million of PE and VC investment in companies based in the Cayman Islands. Increased investment in companies based in British Virgin Islands, Bahamas, Guatemala, El Salvador, Barbados, Anguilla and the Dominican Republic over the twelve months came at the expense of those in Bermuda, Brazil, Chile and Argentina, among others. Companies based in the Cayman Islands were once again the main targets by volume in Q1 with 144 deals (Q1 2015: 136), compared to 105 deals for the British Virgin Islands (Q1 2015: 88). While Brazilian companies signed off 88 deals over the three months, this was down 45 per cent from 161 in Q Page 4

6 Top 20 deals by value Deal value Deal type Target Target country Acquiror Acquiror country Announced date 1. 4,777 Acquisition 100% CITIC Real Estate Co., Ltd; Tuxiana Corporation CN; VG China Overseas Land & Investment Ltd HK 14/03/ ,743 Acquisition 69% to 100% acting in concert New World China Land Ltd KY Easywin Enterprises Corporation Ltd HK 26/02/ ,000 Minority stake Uber (China) Ltd KY Investors; CITIC Securities Co., Ltd; China Minsheng Banking CN; CN; CN; 11/01/2016 Co., Ltd; China Life Insurance Co., Ltd; China Vanke Co., Ltd; HNA Group Co., Ltd; China Lounge Investments Ltd; China Broadband Capital Partners LP; China Taiping Insurance Holdings Co., Ltd CN; CN; HK; CN; HK 4. 2,000 Acquisition to 100% TSMC Global Ltd VG Taiwan Semiconductor Manufacturing Co., Ltd TW 02/02/ ,287 Acquisition 100% SEA (BVI) Ltd VG Profit Plus Global Ltd's wholly-owned subsidiary 25/02/ ,200 Capital increase 5% Cheung Kong Infrastructure Holdings Ltd BM OVPH Ltd KY 23/02/ ,148 Acquisition 100% China Cord Blood Corporation KY Nanjing Xinjiekou Department Store Co., Ltd CN 07/01/ ,148 Acquisition 100% Servicos e Tecnologia de Pagamentos SA BR FleetCor Technologies Inc. US 15/03/ ,120 IBO 100% Viridian Group Holdings Ltd KY ISQ Global Infrastructure Fund US 29/03/ Acquisition 100% United Faith Ventures Ltd VG ENN Ecological Holdings Co., Ltd CN 22/03/ Minority stake 5% to 29% CAR Inc. KY UCAR Technology Inc. KY 14/03/ Capital Increase 33% China Oceanwide Holdings Ltd BM 25/01/ Acquisition 100% ChipMOS Technologies (Bermuda) Ltd BM ChipMOS Technologies Inc. TW 21/01/ Acquisition to 100% Foxconn (Far East) Ltd KY Hon Hai Precision Industry Co., Ltd TW 30/03/ Capital Increase 12% China Hongqiao Group Ltd KY 08/01/ Acquisition 100% Xtralis Group Holdings Ltd BS Honeywell International Inc. US 04/02/ Minority stake 24% China Shengmu Organic Milk Ltd KY Nong You Co., Ltd VG 28/01/ Acquisition 100% Gains Prestige Ltd VG 3SBio Inc. KY 04/03/ Acquisition 100% Geoswift Asset Management Ltd VG Guangbo Group Stock Co., Ltd CN 20/01/ Acquisition 100% Hao Chang Ltd VG Up Energy Investment Co., Ltd VG 15/01/2016 Page 5 Zephyr is a database of M&A, IPO, private equity and venture capital deals with links to detailed financial information on companies. For more information visit

7 Target countries by volume - Latin America deals Target countries by value - Latin America deals Target sector Q Q Q Target sector Q Q Q Cayman Islands British Virgin Islands Brazil Bermuda Mexico Chile Argentina Colombia Dominican Republic Barbados Bahamas Anguilla Ecuador Panama Cuba Nicaragua Guatemala Venezuela Uruguay El Salvador Peru Paraguay Cayman Islands 14,563 34,810 15,293 British Virgin Islands 9,222 15,374 13,729 Bermuda 30,174 7,180 6,320 Brazil 16,312 7,341 2,500 Mexico 12,727 4, Bahamas Chile 1, Panama Guatemala El Salvador Colombia Argentina Barbados Anguilla Dominican Republic Peru 471 1,397 1 Page 6

8 Deal types by volume in Q Deal types by volume Acquisition Capital increase Minority stake MBO IBO Merger MBI / MBO Deal type Q Q Q Acquisition Capital increase Minority stake MBO IBO Merger MBI / MBO Deal types by value in Q Deal types by value Acquisition Capital increase Minority stake IBO MBO MBI / MBO Deal type Q Q Q Acquisition 53,851 33,159 21,818 Capital increase 14,843 12,519 9,914 Minority stake 9,967 12,842 5,710 IBO 0 11,346 1,132 MBO 47 2, MBI / MBO Page 7

9 Target sectors by volume - Latin America deals Target sectors by value - Latin America deals Target sector Q Q Q Target sector Q Q Q Other services Machinery, equipment, furniture, recycling Chemicals, rubber, plastics Wholesale & retail trade Metals & metal products Construction Publishing, printing Primary sector Food, beverages, tobacco Textiles, wearing apparel, leather Transport Gas, water, electricity Wood, cork, paper Education, health Post and telecommunications Hotels & restaurants Banks Insurance companies Public administration and defence Other services 9,208 24,491 18,128 Construction 8,886 8,795 8,738 Machinery, equipment, furniture, recycling 23,190 4,873 3,134 Publishing, printing 1,704 10,255 2,906 Gas, water, electricity 2,524 3,318 2,421 Metals & metal products 1,554 1,609 1,847 Education, health 94 1,324 1,693 Chemicals, rubber, plastics 10,428 4,876 1,182 Transport 817 2, Primary sector 944 1, Food, beverages, tobacco 1, Wholesale & retail trade 4,759 4, Textiles, wearing apparel, leather 320 1, Post and telecommunications 5, Wood, cork, paper Hotels & restaurants 633 1, Banks 212 1, Insurance companies 6, Public administration and defence Page 8

10 Latin America private equity deals by volume and value Announced date No of deals Total deal value Q ,346 Q ,955 Q ,565 Q ,228 Q ,371 Q ,686 Q ,771 Q ,570 Q ,053 Page 9

11 Latin America private equity deals by volume and value 14, , Deal value 10,000 8,000 6,000 4, , Q Q Q Q Q Q Q Q Q Total deal value Number of deals Page 10

12 Top 20 private equity deals by value Deal value Deal type Target Target country General Partner/Fund Manager Announced date 1. 2,000 Minority stake Uber (China) Ltd KY CITIC Securities Co., Ltd; China Minsheng Banking Co., Ltd; China Life Insurance Co., Ltd; 11/01/2016 China Vanke Co., Ltd; HNA Group Co., Ltd; China Lounge Investments Ltd; China Broadband Capital Partners LP; China Taiping Insurance Holdings Co., Ltd 2. 1,120 IBO 100% Viridian Group Holdings Ltd KY I Squared Capital Advisors LLC 29/03/ Minority stake 5% Fibria Celulose SA BR J Safra Sarasin Asset Management (Bahamas) Ltd 13/01/ MBO 56% acting in concert China Ming Yang Wind Power Group Ltd KY Guangzhou HYAF Fund Management Co., Ltd 03/02/ MBO 26% acting in concert Dongpeng Holdings Co., Ltd KY Sequoia Capital Operations LLC 18/02/ Minority stake Katerra Inc. KY 23/03/ MBO 76% Jinpan International Ltd VG Forebright Capital Management Ltd 25/01/ Minority stake Zhongmei Healthcare Group Ltd KY Carlyle Group LP 31/01/ Minority stake Qyer Inc. KY SIG China Investments GP LLC 06/01/ Minority stake Nu Pagamentos S A BR 08/01/ Minority stake Markel CATCo Reinsurance Fund Ltd BM 14/01/ Minority stake Drconsulta Ltd KY 02/03/ Minority stake Rocket Pharmaceuticals Ltd KY 15/01/ Minority stake AB&C Leasing de Mexico SA de CV MX Northgate Capital LLC 03/02/ Minority stake 6% Qiniu Ltd VG Shanghai Zhangjiang Science & Technology Venture Capital Co., Ltd; Shanghai Zhangjiang 01/01/2016 Holding Co., Ltd IBO majority stake YesSinergy do Brasil Agroindustrial Ltda BR ACPE Advisors SA 17/03/ Minority stake WebRadar Software e Servicos para Telecom SA BR Qualcomm Ventures; DGF Investimentos Gestao de Fundos Ltda 29/01/ Minority stake Alegro Medica Ltd BS 03/03/ Minority stake Quinto Andar Servicos Imobiliarios Ltda BR Kaszek Ventures 20/02/ Minority stake Passei Direto SA BR Chegg Inc.; Redpoint eventures Consultoria Empresarial Ltda; Valor Capital Group LLC; Bozano Investmentos Ltda 18/03/2016 Page 11 Zephyr is a database of M&A, IPO, private equity and venture capital deals with links to detailed financial information on companies. For more information visit

13 Target countries by volume - Latin America private equity deals Target countries by value - Latin America private equity deals Target sector Q Q Q Target sector Q Q Q Brazil Cayman Islands Mexico Colombia British Virgin Islands Bahamas Peru Chile Bermuda Argentina Cayman Islands 1,031 10,546 3,788 Brazil British Virgin Islands Bermuda 1, Mexico Bahamas Chile Colombia Peru Argentina Page 12

14 Target sectors by volume - Latin America private equity deals Target sectors by value - Latin America private equity deals Target sector Q Q Q Target sector Q Q Q Other services Publishing, printing Machinery, equipment, furniture, recycling Wholesale & retail trade Gas, water, electricity Chemicals, rubber, plastics Food, beverages, tobacco Education, health Wood, cork, paper Insurance companies Banks Primary sector Post and telecommunications Metals & metal products Textiles, wearing apparel, leather Construction Transport Hotels & restaurants Public administration and defence Publishing, printing 484 9,357 2,013 Gas, water, electricity 0 0 1,122 Machinery, equipment, furniture, recycling Wood, cork, paper Other services 1,009 1, Chemicals, rubber, plastics Education, health Food, beverages, tobacco Wholesale & retail trade Insurance companies Banks Primary sector Post and telecommunications Metals & metal products Textiles, wearing apparel, leather Construction Transport Hotels & restaurants Public administration and defence Page 13

15 Zephyr Half Year M&A Report Notes to editors Activity is based on the activity of the target company. Deal status is announced within the time period. The sector breakdown uses targets activities as defined to be Major Sectors by Zephyr. The date range is 01/01/ /03/2016 inclusive. The Latin America and Caribbean 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)