Latin Finance - July/August 2012 - 9

M&A

América Móvil moves on Europe
With the equity capital markets remaining largely closed, After years of threatening, Carlos Slim, the Mexican strategic investors continue to play a role in the region’s businessman, arrived in Europe this June in a big way — his ﬁrm, América Móvil, upped its stake in Netherlands-based Royal fundraising plans, and remain a major option for Eike Batista, the Brazilian businessman, in particular. His EBX Group hooked KPN from 8.7% to 28% at a cost of around $3 billion. A week a $300 million investment from General Electric for 0.8% in May before that it had agreed to pay around $1 billion for a 21% and other strategic investors were expected to follow. GE paid stake in Telekom Austria bringing its ownership to 23%. a similar price level to that in a $2 billion sale of 5.63% of EBX The timing is perhaps hardly surprising, given sagging to Abu Dhabi sovereign wealth fund Mubadala Development European prices, particularly for telecoms, which su er along Company in April. with the economic outlook. KPN’s German operations – in a This type of long-term real market where indigenous players money minority investment is have little room to increase market M&A Rank by Volume, Year to July 6 healthy for the region, bankers share – are said to be of particular JPMorgan leads say. The trend will be initially in interest to América Móvil. Rank Advisor Value $m # Deals ﬁnancials and natural resources, The motive behind the purchase 1 JPMorgan 39,536 23 but should be followed by other of Telekom Austria is exposure sectors. Infrastructure is likely to be in eastern European countries, 2 BofA Merrill Lynch 38,030 13 a favourite of international private where América Móvil can use its 3 Lazard 31,634 13 investors, as it already has been for expertise in emerging markets 4 Deutsche Bank 29,994 13 a long time in the case of Canadian telecommunications to improve 5 Barclays 27,377 3 pensions. results in countries expected to 6 Morgan Stanley 24,485 11 Meanwhile, Brazil’s Camargo grow – regardless of the apocalyptic 7 Itau BBA 24,258 32 Correa in June completed the scenarios that may await the other 8 Credit Suisse 20,266 27 takeover of Portugal’s Cimpor, half of the continent. 9 BTG Pactual 19,647 43 ending up with 94.8% of the cement Telekom Austria is said to be 10 Citi 18,289 9 maker. The successful bid concludes pleased about the participation, a process begun in March when welcoming the Mexicans’ expertise Total 113,543 1,007 Camargo Correa, starting with a 33% and ﬁnancial savvy. But KPN failed Source: Dealogic stake, bid for the rest, o ering up to to persuade investors to reject Slim’s €2.5 billion ($1.97 billion). Camargo advances saying his o er – despite M&A Rank by Fees, Year to July 6 aims to unify all of its global cement being a premium to its share price – BTG on top operations under Cimpor. was too small. Rank Bank Revenue $m % Share At the end of May a number of América Móvil says that 1 BTG Pactual 62 47 M&A deals in Brazil closed ahead of controlling stakes are not in its 2 Credit Suisse 34 30 regulatory changes that went into plans. Deutsche Bank is advising the e ect. With more review processes Mexicans in Europe, while Goldman 3 Itau BBA 26 37 pushed towards the front of deals, Sachs and JP Morgan advised KPN. 4 Bradesco 24 22 the new rules will make transactions 5 JPMorgan 24 14 take a bit longer, but should not Total 313 193 discourage business in the future. Another long-expected acquisition in Source: Dealogic Among the largest of these deals Mexico has ﬁnally come to fruition. is the divestment by GP Investments of the Fogo de Chão chain The families that control brewer Grupo Modelo were seen of churrascaria steakhouse restaurants to US private equity ﬁrm waiting for the right price to give Anheuser-Busch InBev the other 50% of the group, perhaps one of the last large beer assets Thomas H Lee Partners for $400 million. The deal is an example of the private equity-to-private equity type of deal that could remaining in Latin America. become more common as the market in LatAm continues to The $20.1 billion price implied an Ebitda multiple of about mature. 16 times, higher than the 14 to 15 level that had been expected. Also that week General Mills agreed to buy Brazilian food The average for industry deals in the last few years of about 13. company Yoki Alimentos for about 1.75 billion reais ($857 A rich multiple was worth it, analysts say, given the million), as it seeks a greater foothold in Latin America.LF growth potential and synergies. To avoid possible antitrust issues, Constellation Brands will buy Modelo’s stake in its US distribution joint venture for $1.85 billion. > UPDATE Morgan Stanley advised Modelo, while Deutsche Bank, Lazard, Barclays, JPMorgan and Bank of America Merrill Lynch For daily M&A news, see www.latinﬁnance.com advised AB InBev.

Endgame in beer battle

July/August 2012

LATINFINANCE 9
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Latin Finance - July/August 2012

Table of Contents for the Digital Edition of Latin Finance - July/August 2012
