Year: 2020
Winner: Bank of America
Disruptive times tend to trigger market reorganization, and our M&A House of the Year winner feels that it is ready to engage in any restructuring waves that emerge from the ravages of 2020.
“Last year was challenging in every sense,” said Augusto Urmeneta, head of Global Corporate and Investment Banking in Latin America for Bank of America Merrill Lynch. “It was a down year for M&As in the region, but we took market share, and that put us in a very good position.”
The recovery of M&A activity is in fact already going on. During the three months starting in March, the market came into a standstill in Latin America, but deals picked up in the second half of the year, he said. Sectors such as healthcare and technology have been particularly busy, with Brazil leading the volume of transactions.
BAML estimates that, between October 2019 and September 2020, it amassed $88.25 mln in fees from M&A deals in Latin America, amounting to a leading 15.5% of the market. It was also a participant in several transactions that were awarded a Deal of the Year award. For instance, BAML was a target advisor for RCO during its acquisition by Abertis and GIC (Private Equity), and played the same role for Avon as it was purchased by Brazil’s Natura (Corporate Cross-Border M&A).
Urmeneta is based in NY, and the bank has offices in Mexico, Chile, Argentina, Peru, Colombia and Brazil, with M&A capabilities in each one of them. Two heads of M&A lead the actions in the areas: Martin Sanchez in NY and Diego Aragão in Sao Paulo.
Urmeneta believes that BAML’s region-wide footprint and global presence has helped the company to lead operations such as the purchase of Sempra Energy’s distribution and generation units in Peru and Chile by Chinese giants CYPC and State Grid, which, combined, amounted to $5.8 bln. But it has not steered away from smaller deals in promising sectors, such as the all-Brazilian purchase, in May, of delivery app Delivery Much by Stone, a fintech.
He identifies positive perspectives for M&A deals in the region in 2021, gaining increasing momentum towards 2022, particularly if equity markets continue to recover as it has been the case in Brazil.
“Generally, a healthy equity market is good for M&As,” Urmeneta said. “Hopefully we will stay the course and see good deals activity.” – LF