Brazil Data Insight (Year-End 2018)
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In a year marked by significant political changes, investors demonstrated growing confidence in opportunities across the private capital spectrum in Brazil. LPs committed USD6 billion to Brazil-focused funds, representing a 267% year-over-year increase and the highest level recorded by EMPEA since 2011. Vehicles managed by Patria Investments—including Patria Private Equity Fund VI, the largest fund ever raised in Latin America—accounted for more than half of all fundraising. Yet, fundraising success was not confined to just one GP, nor to traditional PE strategies. A substantial portion of the 2018 fundraising total accrued to 11 different local currency vehicles, with BRL-denominated fundraising surging to the highest level since 2012. Other fund managers sought to capitalize on investor appetite for private credit fund strategies. GPs raised a record USD2.1 billion for distressed debt, direct lending, and special situations funds—more than quadruple the amount raised over the preceding 12 years combined. In contrast, traditional growth equity activity in Brazil has stagnated. GPs deployed just USD420 million via growth deals in 2018, the lowest amount recorded by EMPEA, although a modest uptick in fundraising for growth equity strategies may point to improving prospects.
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