BRAZIL Law and Practice Contributed by: Rafael Lacerda, Eric Nahum, Rômulo Martins and Fernando Oliveira, Lacerda Diniz Advogados
Lacerda Diniz Advogados 7th Floor 200 Maria Luiza Santiago Street – Santa Lúcia Belo Horizonte Minas Gerais Brazil Tel: +55 313 507 7777 Email: societario@lacerdadiniz.com.br Web: www.lacerdadiniz.com.br
1. Transaction Activity 1.1 Private Equity Transactions and M&A Deals in General Between August 2024 and August 2025, Brazil’s M&A and private equity activity showed signs of returning to a more stable pace. Deal numbers were slightly below the prior year but remained solid overall. Domestic buyers accounted for roughly four fifths of all transac - tions, with foreign investors making up the rest. In the first six months of 2025, 633 deals were com - pleted – a 6.1% decline compared to the same period in 2024, bringing the 12-month total to 1,385. This reflects a more selective approach from investors. While local transactions still dominated, cross-border activity regained momentum in 2025, led once again by US investors. Persistently high interest rates – around 15% on the Selic benchmark – kept financing expensive and put downward pressure on valuation multiples. This pushed deal makers towards more flexible structures such as earn-outs, vendor loans, and greater reliance on private credit. The challenging funding environment and narrow capital market windows supported an uptick in take- private transactions and restructurings of listed com - panies. Corporate carve-outs, divestments aimed at portfolio optimisation, and private equity platform build-up strategies gained ground, while strategic buyers continued to actively participate.
Activity was spread across several sectors, with soft - ware/IT, financial services, food and beverages, ener - gy and general services seeing the most deals. Initial public offering (IPO) activity remained muted, so most exits came via strategic buyers, secondary share sales and selective ABO/follow-on offerings. 1.2 Market Activity and Impact of Macro- Economic Factors In 2025, Brazil’s private equity and M&A market has been most active in business-to-business (B2B) soft - ware and other technology-enabled services (includ - ing cybersecurity and applied AI), renewable energy, healthcare and logistics/infrastructure. High interest rates (Selic 15.00%, as of 30 July 2025) continue to compress leverage and valuations, encouraging earn-outs, vendor financing and private credit. Corporate carve outs, sector build ups and take privates at discounted prices have been com - mon, while IPO windows remain narrow. Global sup - ply chain realignments have supported nearshoring and local manufacturing. Cross border interest has been steady, with US- and Europe based buyers being active, and foreign exchange (FX) and tariff sensitivi - ties reflected in sale and purchase agreements (SPAs) and business plans.
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