Category: M&A

Colombia’s largest financial institution, Bancolombia, is planning to issue more ADRs in New York to help finance its acquisition of El Salvador Grupo Financiero Banagrícola. Earlier this year the bank proposed issuing 60 million preferred shares with non-voting rights to raise an estimated $440 million. Bancolombia bought Banagrícola last December for around $900 million.

Coca-Cola has added to its portfolio of Brazilian beverage companies with the acquisition of tea producer Leão Junior. The company is a leader in the ready-to-drink tea market with well-known brand Matte Leão. The purchase by Coca-Cola, for an undisclosed sum, follows the acquisition late last year of a 50% stake in juice-maker Del Valle, with Mexican bottler Femsa, for $470 million.

Brazilian telcoms regulator Anatel has blocked the acquisition of local cable and internet company Way Brasil by Brazil’s largest telco Telemar. Anatel said Telemar would contravene its fixed-line telephone concession contract if it offered cable TV services in the same regions. The purchase would have given Telemar a foothold in the country’s paid TV market. The telco offered $62.5 million via its mobile phone subsidiary Oi to outbid a subsidiary of Mexico’s Telemex in an auction on São Paulo’s stock exchange, Bovespa, last July. Telemar paid 65% over the asking price of $36.8 million.

Mexican autoparts supplier Nemak, a subsidiary of local conglomerate Grupo Alfa, has closed its acquisition of assets belonging to TKAluminum for $414 million in cash. The assets include six plants in Argentina, Brazil, Mexico and the US and gives the firm new clients in Europe. Italian-based TKAluminum will receive a 5.64% synthetic equity interest in the Nemak business as part of the deal.

Colombia’s largest retailer, Almacenes Exito, has raised a further $1.3 million from the sale of new shares as part of its acquisition financing of local rival Carulla Vivero. Exito sold 277,377 new shares in a second and third round after raising $116 million from the first-round sale of 24.4 million new shares earlier this month. The proceeds of the share sale will go towards funding the $470 million acquisition of a 72.2% stake in Carulla.

Brazilian mergers and acquisitions totaled $62.68 billion (131.7 billion reais) last year, an increase of 237% over the previous year, according to Associação Nacional dos Bancos de Investimento (Anbid). The figure includes public share offerings and corporate restructurings. The amount of “pure” M&A transactions rose 348%, from $9.52 billion to $42.69 billion (20 billion reais to 89.7 billion reais). Of these, 67% or $53.95 billion were accounted for by deals involving foreign acquisitions. Even when CVRD’s acquisition of Canada’s Inco is removed, these transactions grew by 125% compared with 2005.

As part of its acquisition financing of local rival Carulla Vivero, Colombian retailer Almacenes Exito has raised $116 million from the sale of new shares. Exito sold 24.4 million shares to existing shareholders at 10,500 pesos per share. The proceeds of the share sale will go towards funding the $470 million acquisition of a 72.2% stake in Carulla.

Panama-headquartered Grupo Financiero Uno and its subsidiaries (GFU), the region’s largest credit card issuer, has earned ratings upgrades from Fitch Ratings following the group’s acquisition by Citi. Banco Uno in El Salvador has had its long-term national rating raised from A to AAA, while its short-term rating has been raised from F2 to F1+. Meanwhile, in Nicaragua, Banco Uno’s national rating is raised from A- to AA+ (long-term) and from F2 to F1+ (short-term).