Mergers and acquisitions of companies in Argentina grew in 2022

Argentina registered 91 mergers and acquisitions operations of companies last year, the highest number since 2018, for a volume calculated at 4,229 million dollars, according to a report released this Monday by the firm KPMG.

This increase in operations in 2022 -23 more than in 2021- was due to a strong boost from mergers and acquisitions in the energy and natural resources sector, with lithium mining as the protagonist.

According to the report, in the fourth quarter of 2022, 25 merger and acquisition transactions were registered in the Argentine market, totaling 91 operations in the year, the highest figure since 2018.

“Although many of them have not reported the value of the transaction, taking into account those that are publicly known, the total amount involved reaches a total of 4,229 million dollars”KPMG said.

The consulting firm noted that the energy and natural resources sector “continued to exhibit an accentuated role”especially in lithium assets, “which attract the interest of global strategic investors”.

Sales of large renewable energy parks to some of the main Argentine operators and transactions of oil and gas assets were also identified.

For its part, the technology, media and telecommunications industry maintained a significant level of activity in 2022, ending the year as the sector with the greatest movement in the market.

According to the report, in addition to investments by international groups in local technology companies, some operations in the media sector were registered.

“Investors mainly from Australia, Canada and China They carry out numerous transactions in lithium assets, while mainly European and American groups invest in local technology firms from different subsectors”observed Federico Díaz Ascuénaga, head of M&A-Deal Advisory at KPMG Argentina.

Díaz Ascuénaga added that sales by international companies tend to occur in less competitive sectors of the Argentine economy and “They normally correspond to the departure of multinational companies from the country through the sale of their assets to local groups.”

For her part, Andrea Oteiza, partner in charge of Deal Advisory at KPMG Argentina, observed that, although many investors tend to adopt a conservative investment strategy, “wait and see” (wait and see), this year may present “attractive opportunities” for strategic buyers with a greater appetite to assume local risk and positive expectations in the medium and long term.

“In any case, the context of the presidential elections added to the continuity of the macroeconomic difficulties and the exchange restriction, poses a scenario of uncertainty”he pointed.

Source: EFE