By Jorge Porter?/?Business News Americas
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The banking, insurance and technology sectors will likely lead Mexico's M&A activity in the coming months, Laura S?nz, deputy director of Transactional Track Record, told BNamericas.
The technology sector appears to be one of the most appealing for investors as it is one of the least affected by the economic crisis. In addition, the finance sector has also been and will remain one of the most active, as many financial groups continue with their expansion strategies in Mexico and abroad, she said.
"Latin America has become a major focus for companies wishing to continue with their expansion strategies. In addition, European companies see the region as a key market to weather the economic turmoil and continue growing. This is reflected in the number of cross-border transactions, which is increasing every month."
The Mexican market witnessed a large increase in transactional activity in 1H12, recording 66 operations compared to 30 in the same period a year ago.
The largest transaction in 1H12 was the world's largest brewer Anheuser-Busch InBev's US$20.1bn cash purchase of the remaining 50% it did not own of Mexico's Grupo Modelo - best known for flagship beer Corona. At the same time Grupo Modelo sold its 50% stake in Crown Imports, the US importer of Corona, to Constellation Brands for US$1.85bn.
The largest proposed deal in the period was telecom giant Am?rica M?vil's (NYSE: AMX) bid to increase its stake in Netherlands telecom provider KPN for US$3.4bn, although KPN's management is scrambling to keep the purchase from happening.
In the financial sector, French catering and vouchers company Sodexo bought Mexican food, meal vouchers and cards provider Servi-Bonos.
Servi-Bonos serves close to 5,000 local clients and generated an issue volume close to 300mn euros in 2011.
Private equity investors also remained interested in technology. Mexican private equity fund Nexxus Capital bought a 31% share capital of Mexico-based online travel agency Price Travel, through their vehicles Nexxus Capital IV and CapitalV.
In addition, the US private equity fund OpenGate Capital acquired 100% of Getronics Brasil, Getronics M?xico and Getronics Colombia, the Latin American subsidiaries of KPN.
Cross-border transactions are expected to keep rising in coming months, especially US companies looking to expand in Mexico and vice versa, S?nz said.
She said Spanish firms have also been making purchases in Mexico to continue with their growth strategies, and foreign companies are expected to keep expanding in Latin America to offset contracting markets elsewhere.
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