The Latin American Lawyer September 2018 LATAM MAGAZINE SEPT18 | Page 7

News
advised on 25 per cent more deals
in the first half of 2018 compared
to the previous year, according to
Mergermarket. “Some large deals
have already been announced and
there are others under negotiation
so the pipeline is encouraging,” he
says, noting transactions involving
publicly-traded companies have
increased, as has the complexity
of deals. Meira adds that deals are
being driven by a diverse range
of investors: “We see Asian—
primarily Chinese—and European
investors pursuing growth
opportunities in Brazil,” he says.
“US investors are also present,
but participation is at lower than
historical levels – sovereign funds
and private equity firms are also
important players.”
Private equity firms, both
from the US and Europe, are
making a significant number of
acquisitions in Latin America,
according to Cerezo. He says Latin
America-based family groups
and their subsidiary companies
are continuing to expand, further
fuelling M&A activity. “Many
of these groups have outgrown
their home markets and have
aggressively expanded regionally
and globally,” Cerezo explains.
“Their appetite for growth, in
some instances effectively acting
as private equity firms, is a trend
that is significantly impacting the
M&A market in Latin America.”
Hedge funds driving deals
In Mexico, private equity
and hedge funds are driving
transactional activity, says Iker
Arriola, partner at Creel, García-
Cuéllar, Aiza y Enríquez in
Mexico City, a firm that, year-
on-year advised on 29 per cent
more deals in the first half of 2018.
He adds that US, Canadian and
Asian funds have shown the most
interest in Mexico during 2018.
Arriola expects M&A activity
in Mexico to increase in the
second half of the year, following
a relatively small slowing of
investment decisions due to
uncertainty caused by the Mexican
www.iberianlawyer.com/latin-america
general election earlier this year
as well as doubts about the North
American Free Trade Agreement
(NAFTA).
With the current US
administration pushing for
changes in international trade,
including the renegotiation of
NAFTA – which covers Canada,
Mexico, and the United States
– there are concerns about the
potential impact of these changes
on the Mexican economy. Manuel
Padrón, a partner at Baker
McKenzie in Juárez, Mexico,
believes it is a positive sign that
the governments of Mexico and
the United States reached an
agreement on NAFTA in August
2018. However, he adds that “a
bilateral agreement is insufficient
for Mexico”. Padrón says the early
signs point to some favourable
terms for Mexico, for example,
the dropping of the Trump
administration’s demand that
half of an automobile’s parts
must be manufactured in the US.
Other conditions that have been
negotiated include a proposed
rule that states 40 per cent of the
vehicle should be manufactured
by workers that receive a
minimum wage of $16 per hour.
With regard to agricultural goods,
it seems Mexican products will
not be adversely affected by the
renegotiation of NAFTA and
that standard international trade
practices will be continued.
Meanwhile, investors are
demanding more from their
legal advisers in Latin America,
according to Meira, particularly
in terms of accountability,
availability, consistency, delivery,
and team work. He notes that
competition for high-end deals in
Brazil is fierce and few law firms
are able to completely satisfy
client needs in highly complex
deals. Meanwhile, Cerezo says
global clients are also demanding
more use of technology and
increased global integration of
legal advisers.
News in brief
Holland & Knight advises Fibra
UNO on $500m debt issuance
Holland & Knight advised
Mexican real estate investment
trust Fibra UNO (FUNO) on a
$500 million debt issuance, which
was registered on the Mexican
Stock Exchange. FUNO is a real
estate investment trust, with 230
billion pesos ($12 billion) of real
estate assets under management,
and around 22.4 billion pesos ($1.2
billion) of projects in the pipeline.
Marval acts for Posco on $280m
Argentinian lithium mining rights
deal
Marval, O’Farrell & Mairal
advised South Korean steelmaker
Posco Corporation on the
acquisition of mining rights
in Argentina from Australian
lithium mining companies Galaxy
Resources Limited and Galaxy
Lithium for $280 million. The deal
represents the first step in Posco’s
plans to develop Sal de Vida, a
large-scale, as yet undeveloped,
lithium borate project.
Clifford Chanc e advises on
Mexico solar project financing
Clifford Chance acted for 174
Power Global as sponsor in the
project financing of Laguna Solar,
a 101-megawatt solar photovoltaic
plant planned for the northern
state of Coahuila. The company
174 Power Global is an affiliate of
Hanwha Group, a South Korean
renewable energy business.
Clifford Chance’s team included
partner Fabricio Longhin, senior
associate Alberto Haito and
associates Alan Sakar Azuara and
Eli Keene.
Gaona signs strategic alliance
with Otárola & Prialé in Peru
Spanish law firm Gaona Abogados
BMyV’s Peruvian office has signed
a strategic alliance with Otárola &
Prialé Abogados.
September 2018 • THE LATIN AMERICAN LAWYER •
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