The Mergers and Acquisitions (M&A) market in Latin America experienced a challenging 2024, marking the third consecutive year of decline in both deal volume and value. This period saw drops exceeding 15% and a total of over 700 transactions valued at more than €280 billion. However, experts forecast the second half of 2025 as the starting point for the anticipated revival, driven by macroeconomic stabilization and growing investor confidence, identifying high-return opportunities in Latin América companies.
A promising Start to 2025 for readjustment and localized opportunities
According to TTR Data, the first quarter of 2025 showed a widespread contraction across the region, with an 11% decrease represented by 630 registered operations compared to the same period in 2024. However, data from April and May 2025 reveal mixed dynamics; while deal volume continued to fall by another 10% year-on-year, the aggregate deal value showed a growing curve with a 17% increase in transactions in May, a clear sign that high-impact deals are shaping a new, promising pipeline.
Which countries are leading the upward curve in Mergers and Acquisitions (M&A)?
The countries solidifying their positions as regional leaders in investment for 2025 are Brazil, Mexico, and Chile, followed by Argentina (with increased confidence in the Milei government) and Colombia (though with some caution due to recent violence), both showing a promising growth trajectory. Brazil, considered the world’s seventh-largest economy, maintained its 2024 dominance, accounting for 60% of the value and 55% of the transaction volume in the region – meaning almost 6 out of every 10 deals took place in the South American nation.
Regarding sectors, technology remains the key driver. The Fintech vertical remained the most active in M&A during April 2025, accounting for 24% of all activity, closely followed by AI, Data, and Automation (17%), and IT Services (13%). The energy, financial services, and manufacturing sectors are also emerging as growth drivers in LatAm.
Private Equity: Investment Trends
Private Equity (PE) is emerging from a period of uncertainty. After a couple of years of decline, PE dealmaking activity rebounded in 2024, with a notable increase in the value and number of large deals exceeding €400 million. The availability of ‘dry powder’ or liquid assets for future investments is estimated at over $1.6 trillion globally. Experts believe that investor pressure for divestments (which represented 71% of total capital in 2024) will drive the second half of 2025.
In this context, according to a Herbert Smith Freehills report, overvalued investments are expected to correct, allowing the 2025 pipeline to be completed with significant deals and future operations. Furthermore, Private Equity investment trends are notably shifting towards the technology and energy sectors, with a growing focus on sustainable and high-growth investments.
Challenges and opportunities in a turbulent 2025
Despite the optimism, challenges persist. Global uncertainty, the Middle East conflict, the unpredictable oil price, political representation crises, and the Trump economy could impact the region, compounded by regulatory and fiscal policies, and local issues. For example, Mexico faces threats from potential tariff increases.
Along these lines, BRG associate analyst in Buenos Aires, Alejandro Martinolich, warns that with high-value assets, recurring political changes, and macroeconomic uncertainty, particularly in Brazil and Mexico, Latin America presents ideal conditions for disputes. Indeed, an increase in M&A disputes is expected, especially in transactions under €40 million, primarily due to financial and operational performance issues followed by currency volatility. It is in these operations that personalized corporate finance advisory becomes invaluable for avoiding disputes and securing significant returns by leveraging the recovery.
No Risks, No Opportunities
Inflation stabilization and digitalization are creating a favorable environment. Private credit is gaining popularity, filling financing gaps and offering more flexible options. The integration of AI in M&A processes (from opportunity identification to due diligence automation) is accelerating; however, in this transformative process, boutique and personalized advice will be the ideal complement to technological change in the sector. The use of transaction insurance is increasing, even in emerging markets, which reduces risks and facilitates transactions.
Conclusion: Mergers and Acquisitions (M&A) Trends for H2 2025 are encouraging
This period is shaping up to be one of recovery and dynamism for the LatAm M&A market. The key for investors and businesses will be pragmatism, patience, and professional advisory, adapting to changing conditions to seize opportunities arising from economic stabilization, technological innovation, and the growing importance of prudence in securing favorable deals.
