São Paulo-based firm Demarest Advogados has bolstered its M&A practice with the inclusion of Marcos Schroeder as a partner. Schroeder, who spent nearly two decades at Wald Associados Advogados, has assisted clients such as Mitsui, Odebrecht, and Credit Suisse with corporate and capital markets transactions. Schroeder said that at Wald, he gained broad experience in capital markets, arbitration, and international law, and he hopes to lend his varied experience to cross-staffing with other practice areas at Demarest.
According to Schroeder, despite a slowdown in Brazil’s economy, caused by a racheting-up of investor caution amid continuining political and economic uncertainties, M&A activity has steamed along at a reasonable pace in 2014.
“Most transactions involved the acquisition of a majority interest in the target company, followed by transactions involving acquisition of a minority interest, and, far behind, by formation of joint ventures,” he said. “The most important sectors for M&A transactions in Brazil have been services including education, consulting, marketing and advertising, retail, food and beverage, energy, oil and gas, transportation and logistics, construction and real estate, and finance. The challenges to be faced will be fear of recession—which may cause volatility in future revenue streams and the quality of targets' earnings—anticipated increase in interest rates, and availability and cost of financing.”
Brazil’s capital markets forecast also looks promising, and Schroeder points out that with the World Cup and presidential elections now in the rear view mirror, the region’s capital markets are ready for a boom.
“Not only large corporations, but also middle-market businesses will likely benefit from the [expected rise in deal flow], in [view] of their need for long-term investments, as an alternative to public funding from the Brazilian National Development Bank,” he said. “The need for development of infrastructure will also positively affect Brazil's capital markets. A challenge will be competition with the fixed-income market due to an anticipated increase in interest rates.”
Schroeder graduated in Law from Universidade de São Paulo and is a member of the Mediation and Arbitration Commission of the Brazilian Bar Association, São Paulo Chapter (OAB/SP).