Private Equity Firms Still Optimistic about Brazilian Agricultural Investments
By Elizabeth Johnson
Private equity firms are still bullish on Brazilian agricultural investments, in spite of the tight credit markets. Investors with cash say the current market turmoil will create opportunities in Brazil’s fast growing agricultural sector, especially in the heavily leveraged sugar and ethanol sector, where analysts expect a wave of mergers and acquisitions. But investors are also piling into the attractive beef, coffee, bioenergy and infrastructure and logistics sectors. Page 1
IGNIA Fund Closes on Loan from IDB and Launches Shared Service Company
IGNIA Fund I has closed a debt facility of up to US $25 million from the Inter-American Development Bank (IDB). Page 1
EMPG in $125M Joint Venture with Dubai Fund; Educational Publishing to Include Latin America
Education Media and Publishing Group (EMPG), the owner of Houghton Mifflin Harcourt, a leading educational publisher in the US, is entering into a $125 million (€94 million) venture with the government of Dubai to target the educational publishing sector in high-growth developing markets in Latin America. Page 6
Peru: Best in the Class
By Walter Molano (BCP Securities, LLC)
Peru was one of the main beneficiaries of the commodity boom, transforming from a backwater of poverty and violence into one of the leading economies of Latin America. Although Peru is the shining star of Latin America, many people are concerned about the political situation. With a support rate of only 19%, President Alan Garcia’s popularity is one of the lowest among Latin American presidents, even though his economy is one of the most resilient. Page 7
Structuring Latin American Investments via Spanish ETVE Holding Company
By Victor Cabrera, Antonio Lobon and Marc Skaletsky (KPMG LLP)
Spain has emerged as one of the most attractive jurisdictions for multinational corporations (MNCs), including U.S. MNCs, to establish a holding company for Latin American operations. In 1996, Spain enacted into law its holding company regime (Entidad de Tenencia de Valores Extranjero, or “ETVE”). Key factors in the attractiveness of an ETVE having business substance include (i) Spain’s extensive tax and investment treaty network with various Latin American countries, and (ii) Spain’s European Union (EU) membership and the resulting coverage by the EU Parent-Subsidiary and Merger Directives. Page 2
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