Appetite Grows For Mergers And Acquisitions In Latin America: Study

• Latin America is increasingly seen as an attractive market for mergers and acquisitions (M&A), with the ongoing U.S.-China trade spat helping to whet investor appetite for opportunities in the region, a KPMG survey of executives showed on Monday.
• The survey of nearly 400 executives across 14 countries globally showed technology, financial services and energy sectors leading the way and Mexico overtaking regional heavyweight Brazil for the top spot in M&A activity.
• "Opportunities already outweigh challenges," said Gerardo Rojas, head of KPMG's Advisory Practice in Mexico and Central America. "The risks investors see in Latin America are outweighed by the desire to get out of Asia, particularly China, due to their trade war with the United States."
• Nearly half of the executives who took part in the study said there had never been a better time for M&A opportunities in the region, even as risks still abound.
• Notwithstanding, investors are closely monitoring regional geopolitical and economic risks and could get spooked if they see a breakdown in the rule of law, governments nationalizing private firms or a lack of incentives for foreign investment, Rojas said.
• Driven in part by its proximity to the U.S. and a nearshoring boom, Mexico was considered an attractive place to conduct business by 79% of the participants; followed by Brazil by 69% and Costa Rica by 54%, respectively. Additionally, mining powerhouses Chile and Peru could see investments in manufacturing rise.
• These investment possibilities bode well for the nations in terms of economic growth and foreign direct investments as the economies are still emerging from COVID and other global tensions.

(Source: Reuters)