By Alberto Dent and Enrique Lithgow (PwC)
Several economic indicators suggest the next 12 months could be ripe for a surge in M&A and investment activity in Latin America. The primary reasons for a rosier M&A outlook include recovering valuations and the perception that investment risk in Latin America is diminishing. The analysis for this article focuses on valuation multiples across a broad range of industries and sovereign bond yields and related spreads in comparison to US Treasury bonds, which historically correlates to risk aversion.
Acknowledgements: "Valuation Multiples, Bond Spreads Point to Increased M&A Activity in Latin America in 2010", Alberto Dent and Enrique Lithgow, The Latin American Law & Business Report, Volume 18, Number 2, February 2010, and Copyright 2010 Thomson Reuters/WorldTrade Executive.