The Future of Brazil's M&A Industry

The 2011 World Economic Forum on Latin America in Brazil focused on sustainable business growth in Latin America and creating long-term economic stability. Brazil has one of the fastest growing world economies, and at a time when global interest in the region is ramping up, what better place to discuss its future economic outlook?


1 June 2011

The 2011 World Economic Forum on Latin America in Brazil  focused on sustainable business growth in Latin America and creating long-term economic stability. Brazil has one of the fastest growing world economies, and at a time when global interest in the region is ramping up, what better place to discuss its future economic outlook? The country has attracted strong attention from the rest of the world, resulting in increasing cross-border deal flow. A recent article appeared in the Financial Times stating that the volume of mergers and acquisitions in 2010 reached nearly $153bn compared with almost $60bn a year earlier. Banks like JP Morgan and Citibank are also staffing up in the region to support increasing business.

With a rapidly growing economy, a key topic of conversation at the conference was how to ensure the region’s businesses had an effective and cost efficient technology infrastructure to support day-to-day business needs. Generating enough energy to support the technological backbone to run international businesses is a critical part of the long-term growth of Brazil’s economy. The cost and energy consumption produced if each company supported multiple servers needed for various business processes presents a potential challenge for the future of the region’s businesses as well as its environment.

During one of the seminars I attended, a key initiative that is already being explored in the region involves centralizing cost-effective cloud infrastructure around cheap, and renewable energy resources. The ability of cloud computing to support green initiatives that are important to preserving the region’s rich natural resources was also a part of the discussion.

It made me think about how Intralinks is a natural fit in the business environment, by not only eliminating paper, but also by providing a low cost, hosted solution enabling businesses to reduce the energy consumption that would occur if they hosted the infrastructure themselves. We have already made a strong business commitment in Brazil, and we are excited to be in the position to play a strong role in business growth by facilitating business transactions.

The recent release of the Q1 2011 Intralinks DFI do Brazil, which provides an early view of aggregate deal flow activity and trends in the market, supports continuing evidence of growth in the region. There was a 60% increase in Brazil M&A deal activity via the Intralinks platform in Q1 2011 versus Q1 2010. This is compared to a 39% increase in the rest of Latin America. The DFI also found that 70% of Brazil M&A deals in Q1 2011 involved cross-border deals, a consistently high trend over recent quarters.

The M&A market in Brazil is, as they say in Portuguese, forte. The number of cross-border deals demonstrates the Brazilian M&A market is an important part of the global economy. As Intralinks and Brazil continue to grow together, we look forward to being a partner in the region and helping to support businesses by enabling them to have secure access to efficient data exchange and by facilitating cross-border deal flow with a cloud-based platform. It’s great to think how cloud is an agent of change for Brazil that empowers business teams.

The author’s comments reflect the data reported in the Intralinks Deal Flow Indicator TM (the “DFI”) for the first quarter of 2011 published on May 18, 2011. The DFI and the author’s comments are based on observations and subjective interpretations of M&A deal activity and are not intended to be indicators of Intralinks business performance or operating results for any prior or future period.