Political Risk Latin America Blog @PolRiskLatam

Argentine M&A jumps, with a little help from the Brics

Posted in News and Articles, Political Risk by politicalrisklatam on September 30, 2010

by Jude Webber for Financial Times, September 29th, 2010.

Investors have plenty of reasons to shy away from Argentina: many exports are heavily taxed; there are seasonal gas shortages; and the rules of the game have a nasty habit of changing.

But Argentina has seen an increased number of mergers and acquisitions in the first half of the year. And what’s especially interesting is who’s doing the buying: not the traditional US or European companies, but increasingly the Brics.

Argentina’s natural resources, laboratories, and food, technology and financial companies are attractive targets for the emerging powers of Brazil, India, Russia and China, according to consultancy Deloitte & Touche.

Argentina’s star deal so far in 2010 involved China’s state oil company, CNOOC, which paid $3.1bn for 50 per cent of Bridas Corp. CNOOC may yet go even further: Bridas Corp holds a 40-per-cent share in key energy company Pan American Energy (PAE), and there’s now speculation that CNOOC will seek to buy the remaining 60-per-cent of PAE that is currently owned by BP, which is selling assets in the wake of the Gulf of Mexico spill. (continue reading… )

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