BRAZIL Law and Practice Contributed by: André Menescal Guedes, Raissa Freire de Almeida and Bruno Paiva, André Menescal Advogados
André Menescal Advogados Avenida Desembargador Moreira 1300 Ed. BS Design Torre Norte, Salas 301 a 306 Fortaleza, Ceará 60170-001 Brazil Tel: +55 84 91234 5678 Email: contato@amadvogados.com.br Web: andremenescal.adv.br/pt-br
1. Market Trends 1.1 Energy and Infrastructure M&A Market The Brazilian energy and infrastructure M&A market has remained resilient in 2025, showing a modest recovery in value terms compared to 2024. Accord- ing to market reports, Brazil continues to lead Latin America in deal count and capital deployed, with energy and infrastructure representing a dispropor- tionate share of total transactions. Large-cap deals in regulated assets – such as transmission lines, hydro plants, sanitation concessions and port terminals – are driving market activity and attracting both strategic investors and global infrastructure funds. The key driver of this activity has been the pursuit of inflation-protected, long-term cash flows in a still high-interest-rate environment. Although the Selic rate has declined gradually, financing for greenfield projects remains selective, pushing investors towards brownfield and late-stage assets with stable or regu- lated revenues. Inflation itself has been secondary; the greater challenge is the cost of capital and access to long-term credit, which have encouraged portfolio rotation. Sponsors are selling mature assets to recycle capital, while foreign funds and industrial players seek scale through acquisitions. Renewable generation remains a strategic focus, but valuations in wind and solar have softened due to curtailment risks in the Northeast. Transmission con- straints have limited dispatch for several projects, directly affecting energy sales and investor con- fidence. As a result, M&A interest in renewables is
increasingly tied to hybrid projects with storage, firm offtake contracts or access to dispatchable capac- ity. Conversely, transmission, gas-fired and multi-fuel thermal assets, sanitation and logistics concessions continue to attract strong interest as “defensive” infra- structure. Geopolitical uncertainty – including conflicts in Ukraine and the Middle East – has reinforced Brazil’s posi- tion as a diversification hub for global capital seeking energy security. Domestic policy has also evolved: the government recently announced guidelines for the 2026 capacity auction (LRCAP 2026), signalling continued remuneration for firm generation, including thermal plants using biodiesel. Overall, while deal volume has stabilised, transaction values have increased, reflecting consolidation and selective investment. Compared to the global M&A environment, Brazil’s energy and infrastructure mar- ket remains robust, with activity broadly aligned with international trends and outperforming in regulated and dispatchable segments. 1.2 Energy and Infrastructure Trends Over the past 12 months, three major trends have defined Brazil’s energy and infrastructure landscape: (i) consolidation of mature assets; (ii) repricing of renewable portfolios affected by curtailment; and (iii) acceleration of the low-carbon industrial agenda led by hydrogen, biofuels and port-based energy hubs. M&A activity increasingly reflects a shift from growth- driven acquisitions to strategic repositioning. Large
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