Carlyle Bolsters Brazil LBO Business

Carlyle has tapped Fernando Borges, CEO of AIG Capital Investments do Brasil, to spearhead its new Brazilian LBO business, a senior person close to the initiative tells LatinFinance. Earlier this year Borges led AIG’s effort to acquire Providencia Industria e Comercio, a Brazilian textile manufacturer for $432m. Three other investors, including Banco Espirito Santo and the Constantino family, which controls Gol Linhas Aereas, also participated in the deal. Carlyle has a buyout group in Mexico and real estate business in both Mexico and Brazil, the latter headed by Eduardo Machado. To date, LBOs in Brazil have been hampered by elevated interest rates and a reluctance from local executives to add leverage. Some domestically run shops, including GP Investments, have begun using bank debt to acquire assets this past year, though leverage ratios are not seen rising past four or five times. Ana Vigon, managing director and head of LatAm private equity of AIG Capital Partners in New York, is expected to replace Borges.