Private Equity in Latin America

• Published in: The journal of private equity Vol. 17; no. 3; pp. 62 - 89
• Main Author: Iturralde, Gabriel Rosado
• Format: Journal Article
• Language: English
• Published: London Institutional Investor, Inc 01-07-2014; Pageant Media
• Subjects: Buyouts; Capital investments; Central banks; Economic forecasts; Economic growth; Emerging markets; Equity; Financial investments; Free trade; GDP; Gross Domestic Product; Growth rate; Inflation; Investment companies; Investment funds; Investment strategies; Investments; Investors; Macroeconomics; Middle class; North American Free Trade Agreement; Private equity; Purchasing power parity; Studies; Tax rates; Tax reform; Trends; Venture capital; Volatility; Latin America
• ISSN: 1096-5572; 2168-8508
• DOI: 10.3905/jpe.2014.17.3.062

Private equity is increasing its presence in emerging markets because developed countries have more barriers to entry as they are more crowded by funds looking for benefits. PE in Latin America has been difficult to predict because of the characteristics of the region. However, with the new economic outlook and the stability of the region over the last ten years, both politically and economically, countries have begun to show promising and sustainable growth, getting the attention of several VC and PE funds. In this new scenario, opportunities to invest in high-quality, private companies have increased, supported by socioeconomic trends that have allowed millions of people to become part of the middle class, thus activating the economy and raising the quality of the enterprises. This article analyzes the private equity outlook and opportunities across the principal countries in Latin America, focusing on the main factors that the author believes are relevant for investors.