Headlines are showing a massive flight of investments toward EM. Brazil is among the top destinations. How does that affect Private Equity?
With last week’s capture of $ 3.27 billion, Emerging Markets Equity funds passed the $ 10 billion milestone in 2010, increasing the amount of portfolio assets to U.S. $ 569 billion. (Jornal Valor) How does it affect the Private Equity sector in Brazil?
With all the attention coming its way, it is natural that prices go up in Brazil. The Bovespa index proves it by being over 70.000 again.
This bullish cycle in stock markets makes PE even more attractive in Brazil. Why? In short, because it offers two essential elements for the PE activity: a growing domestic market and appetite for IPOs. You have product and an exit door for investors.
Advent might agree. They just finished raising a fund of $ 1.65 billion to invest in buying stakes in companies in Latin America. This is the first fund closed by Advent worldwide since the bursting of the financial crisis in October 2008.
According to Jornal Valor, about 50% of that value should go to Brazil. With the new fund, Advent totals $ 5 billion in funds raised for the region through five funds since 1996.