Brookfield Infrastructure Partners said it could find acquisition chances in Mexico as the Trump administration talks of imposing protectionist measures and the peso falls to its lowest level since 1994.
“We believe that concerns over the country may overshoot, much like they did in Brazil and, as a result, our business development efforts have increased to capitalize on opportunities that may arise,” CEO Sam Pollock told analysts in an earnings call.
The Canadian asset management company has spent the past two years looking for possible acquisitions, particularly corporate carve-outs, Pollock said.
As Brazil remained mired in recession last year, Brookfield led a consortium that bought the natural gas pipeline operator Nova Transportadora do Sudeste (NTS) from Petrobras for $5.19bn. Brookfield also spent $768m for 70% of Odebrecht Ambiental and €115m ($123m) for 50% of three transmission lines owned by ACS.
Mexico’s economic prospects have not looked so grim for more than 20 years, but the weaker peso presents a “very interesting entry point” for investors like Brookfield, Pollock said.
“What attracted us to the Mexican market more recently was the liberalization of the energy sector,” he said. “I would say today we also have an interest in a number of transportation assets,” he added.
Brookfield focused on investing in Brazil over the past two years, while many investors remained on the sidelines. The investor now plans to deploy more than $1bn in the gas and electricity utility sectors in the country, Pollock said.
“It’s possible that similar situations may be developing in Mexico,” he said.
Pollock also said Brookfield expects to raise $1.5bn to $2bn from asset sales in the next few years.