Brazilian agribusiness mergers and acquisitions achieve highest performance in 5 years according to KPMG

The agribusiness sector has seen a significant increase in mergers and acquisitions in recent years, with 2024 recording the highest number in the past five years. A report by KPMG revealed that there were 12 mergers and acquisitions in the sector from January to December 2024, a 140% increase compared to the same period in 2023 when only 5 transactions were completed, focusing on the sugar/ethanol and fertilizer segments. The fertilizer segment stood out in 2024, with 9 transactions completed during the year, reflecting the capital-intensive nature of the industry and the risks associated with it.

Giovana Araújo, the agribusiness lead partner at KPMG, noted that the increase in mergers and acquisitions in the fertilizer segment was expected due to the sector’s exposure to counterparty risks, especially amidst rising judicial recoveries in agriculture. The types of operations varied, with five transactions being domestic (between Brazilian companies), three involving foreigners acquiring Brazilian companies, three by Brazilians acquiring companies in Brazil from foreigners, and one involving a foreign entity acquiring a company in Brazil from another foreigner.

Overall, Brazil saw 1,582 mergers and acquisitions in 2024, a slight increase of 5% from 2023. Domestic transactions between Brazilian organizations led the way with 981 deals, followed by transactions involving majority foreign-owned companies acquiring Brazilian companies’ capital. Gustavo Vilela, the lead partner for mergers and acquisitions at KPMG Brazil, highlighted the recovery in the M&A market, with the numbers in 2024 surpassing those of 2023. Despite being lower than the figures in 2022 and 2021, the numbers in 2024 exceeded those in 2020 and in previous years.

KPMG is a global network of independent firms offering professional services in audit, tax, and consulting, with a presence in 142 countries and territories and 275,000 professionals worldwide. In Brazil, more than 5,000 professionals are spread across 15 cities in 10 states and the Federal District.

The data presented by KPMG sheds light on the active nature of companies engaging in mergers and acquisitions in the agribusiness sector, pointing towards a positive trend in the market. The rise in transactions in 2024 signifies a recovery and increased activity compared to previous years, indicating a growing interest in strategic partnerships and acquisitions within the industry.