Sector concentration – The 5 most active sectors accounted for 69.8% of total operations and 20.3% of total investments. 21.2% increase in the number of operations compared to the previous month. The press reported 63 transactions in 19 sectors of the Brazilian economy, registering a growth of 21.2% in relation to the previous month (52 operations).

Compared with the same month of the previous year, there was a growth of 3.3%, when 61 businesses were cleared. Evolution in the last 5 years – In the first two months of 2019, after deducting 115 operations, it registered a fall of 3.4% compared to the same period of 2018, when 119 operations were carried out. Larger appetites x bigger falls.

Most representative sectors. In the chart of the most active sectors in the accumulated of the current year, in addition to TI, stand out OTHERS and HOSPITALS AND LAB. OF CLINICAL ANALYZES. In the year to date, the segment with the highest growth in the number of transactions compared to the same period of last year was IT, with an increase of 10 operations, followed by FINANCIAL INSTITUTIONS and TRANSPORT. The sectors with the highest number of transactions in the year, compared to the same period in 2018, were OTHERS – reduction of 7 operations, followed by PUBLIC SERVICES and EDUCATION.

The cumulative volume of transactions over the last twelve months is walking sideways. The month shows a slight increase of 0.2% in the number of M & A transactions accumulated in the last twelve months – February 2019, with 834 operations compared to the same period of the previous month. In relation to the same accumulated period of the previous year – February / 18 – there was a decrease of 4.5%. In the graph of the accumulated, one can infer distinct cycles of growth and fall in the number of transactions.

It highlights probable factors that are most affecting investment expectations and, in particular, the evolution of the historical series of the exchange rate in the same period. Two-thirds of the transactions in the month are up to R $ 50 million – Of the 63 transactions cleared in the month, 45 are up to R $ 49.9 million – 71.4% of the total and accounted for 4.8% of the total. its value. In the year to date, for the same number of operations, 75 transactions were recorded representing 65.2% of the total and 4.0% of the value. This size was the only one to present growth, of 8.7%.

The largest drop was recorded in the volume of transactions of between 50.0 million and 500 million reais. In this period, the reduction was 22.9% in the accumulated of the year, compared to the same period last year. At the top of the pyramid, 6 transactions with a size above R $ 1.0 billion, accounting for 4.8% of the number of operations and accounting for 56.1% of the value of transactions, were accumulated in the year. In the month were registered 3 businesses in this size. There is a 40% drop in the amount of investments in the first two months of 2019.

The total amount of R $ 20.4 billion is estimated as a percentage of total business, representing a significant decrease of 40.2% 2018 – considering Values ​​Disclosed (70.6%) and Undisclosed / Estimated (29.4%). The largest reduction in investments occurred in businesses above R $ 1.0 billion – 46.1%. In February 2019, the value of investments reached R $ 8.7 billion, representing a decrease of 26.2% in relation to the previous month, and also a reduction of 25.1% in relation to the same month of the previous year. Average value of transactions accumulated in the year registered a decrease of 38.1% in relation to the same period of last year.

The average value of transactions made in the year totaled R $ 177.6 million, against R $ 287.0 million in the same period of 2018, representing a reduction of 38.1%. The largest drop in the average value of the two months was due to transactions of more than R $ 1.0 billion, compared to the same period of the previous year. Strategic Investors predominated in volume while Financials in the amount of operations – The biggest appetite this month was on Strategic investors with 43 operations (68.3%), and accounted for 45.3% of the amounts invested. In the two-month period, the Strategic ones, with 81 operations – 12.9% fall – accounted for 70.4% of the businesses and 58.6% of the investments.

The Financials carried out 20 operations in February, in the amount of R $ 4.8 billion. In the year to date, financial investors reached 34 operations – growth of 30.8% – corresponding to 29.6% of businesses and 41.4% of investments. National Investors with the highest appetite in the two months in the volume of transactions. Investors from National Capital accounted for 48 operations – 76.2% in the month. In the year, national investors accounted for 82 operations – growth of 13.9% over the previous year, accounting for 71.3% – and investment of around R $ 5.5 billion, equivalent to 26 , 7% of the total, corresponding to a reduction of 53.2% in relation to the same period of the previous year. Foreign Investors accounted for 59.8% of the amount of transactions in the first two months of the year.

Foreign Capital investors held 15 operations in the amount of R $ 5.7 billion. In the year, Foreigners invested approximately R $ 15.0 billion (73.2%), with a reduction of 33.5%, in 33 operations, corresponding to a reduction of 29.8%. In February / 19, 15 businesses were surveyed by investors from 6 countries. The US, with 8 operations (53.3%), was the one with the largest foreign appetite in the month, reaching 67.2% of the total of these investments. The largest transaction of the month of February / 2019 – IRB confirms stock offer totaling R $ 2.51 billion.

IRB confirmed on Tuesday evening a restricted public offer of 27.6 million of its common shares, in a deal that will result in an amount of R $ 2.51 billion for the selling shareholder, Caixa Fgeduc Multimercado, managed by Caixa Econômica Federal . IRB Brasil Re managed to attract the big foreigners to its stock offer (follow on). The top five orders came from the Norwegian giant Norges Bank, the British Hermes Investment Management and Schroders, the Singapore sovereign fund, the GIC, and the Americans Wellington Management and William Blair & Company. Thus, foreigners accounted for 66% of the offer.

Source: Mergers and Acquisitions