After years of a stagnant market, an incipient recovery in mergers and acquisitions (M&A) in Argentina is prompting Brazilian groups to put asset sales in the neighboring country back on the table, which had been off the radar until recently. Market sources attribute the economic measures implemented by Argentine President Javier Milei, including the lifting of foreign exchange controls, as the primary catalyst for the return of transactions, although foreign investors have yet to be fully drawn in. So far, deals are being closed almost exclusively with local players.

Some companies are selling assets as part of financial restructuring efforts. InterCement, which is undergoing court-supervised reorganization, is moving forward with the sale of Argentine cement producer Loma Negra. Seeking to deleverage, Raízen—owned by Cosan and Shell—has put up for sale its assets in Argentina, including an oil refinery and fuel station network.

Deals are already taking place, spurring Brazilian groups to act. From January to June, Argentina recorded about $3.5 billion in transactions, up 62% from the same period in 2024, according to consultancy TTR Data. Last year, there were 247 transactions totaling $10.8 billion, a 320% increase from 2023.

Conglomerates worldwide have made similar moves. Notable transactions include Pluspetrol’s acquisition of Exxon Oil & Gas areas in the Vaca Muerta formation for more than $1.7 billion; Banco Galicia’s $550 million purchase of HSBC’s Argentine operations; and Newsan’s acquisition of Procter & Gamble’s local business.

Other deals could be finalized in the coming months. According to the international press, Carrefour has hired Deutsche Bank to sell its Argentine operations.

One market source noted that, while financial markets are signaling improvements in Argentina’s economy, many multinationals have already put their local assets up for sale. This is not a new decision, the source stressed, but rather companies taking advantage of current conditions to execute long-standing plans. For the most part, operations are being acquired by local players. Spanish telecom company Telefónica sold its Argentine business to Telecom Argentina, while in February, Mercedes-Benz sold a plant that had opened in the country in 1951.

Juan Bruno, a partner at Argentine consultancy Quantum Finanzas, confirmed the uptick in M&A activity amid macroeconomic changes—a trend that initially showed up in stock market asset valuations. In the M&A market, he said, the current wave is driven by Argentine strategic players acquiring competitors. Foreign capital is expected to join in during a second wave of transactions.

Mr. Bruno also noted growing interest from family offices. Some deals currently under negotiation could be closed in the fourth quarter, he said.

On the Brazilian side, Daniel Lombardi, a partner at boutique advisory G5 Partners—which has a partnership with Quantum—said he has been receiving inquiries from Brazilian business owners about selling assets in Argentina since last year, as monetizing those holdings has become feasible again. “There is pent-up demand from business owners seeking liquidity,” he said, noting that until recently, they did not view these assets as a source of cash.

Bruno Saraiva, co-head of investment banking at Bank of America in Brazil, said he has observed long-term capital flowing into Argentina and, as a result, the bank has been dedicating more time to the country.

In a statement, Carrefour said it had “launched an in-depth strategic review of its business portfolio, covering all its activities and organizational models,” noting the process is at an early stage and declining to comment on market rumors. InterCement declined to comment, and Raízen also did not respond.

Source: Valor Econômico - Brasil