Is Brazil the next big thing for private equity? - The Term Sheet: Fortune's... http://finance.fortune.cnn.com/2010/09/30/is-brazil-the-next-big-thing-for-...

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Is Brazil the next big thing for private equity? - The Term Sheet: Fortune's... http://finance.fortune.cnn.com/2010/09/30/is-brazil-the-next-big-thing-for-...

BLOGS: TOPICS:
Street Sweep Term Sheet | Economics Private Equity Wall Street Washington Dan Primack
Dan Primack joined Fortune.com
in September 2010 to cover
Term Sheet deals and dealmakers, from Wall
The latest on private equity, M&A, deals and movements — from Wall Street to Silicon Valley Street to Sand Hill Road.
Previously, Dan was an editor-
at-large with Thomson Reuters,
where he launched both
Is Brazil the next big thing for peHUB.com and the peHUB
Wire email service. In a past journalistic life, Dan ran a
private equity? community paper in Roxbury, Massachusetts. He currently
lives just outside of Boston.
Posted by Dan Primack
Email This Author
September 30, 2010 3:15 pm

Latin America has long been the final frontier for private equity, but its time may have finally
arrived. Just look at what's happening in Brazil. RECENT RECENT
POSTS COMMENTS

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competitive edge

When I first began covering private equity, my newsletter had a stringer covering Latin
America. Then came the Argentinian debt crisis, followed by the rapid emergence of markets like Receive Fortune's newsletter on all the deals that matter,
India, China and the Middle East. We had to let her go. from Wall Street to Sand Hill Road. Written by Dan
Primack and emailed every day and as news happens.
More than a decade later, Latin America's eclipse may be fading.

Ground zero for the revival is Brazil, where private equity firms invested approximately $3 billion in Sign up now!
the first half of 2010. This is more than twice what was invested in all of last year, and is on track to
top the record-amount invested in 2007 (which was due more to global M&A boom than anything
Brazil-specific). Contributors
Much of this year's activity has been sponsored by local firms, but the spike comes from outsiders. Colin Dollar droops as Fed
Barr official backs easing
Apax Partners, for example, recently invested over $540 million for a control stake in Tivit SA, a STREET SWEEP
São Paulo-based provider of IT and BPO services throughout Latin America. It was the firm's
first-ever acquisition in Brazil. More recently, Warburg Pincus co-led a $206 million deal for a Dan The next evolution of
Brazilian renewable energy company. That deal came out of a São Paulo office that Warburg Primack investor "office hours"
TERM SHEET
Pincus opened just this past February.

Then there is The Carlyle Group, which has done three deals since last year out of its 8-person São Katie The Elizabeth Warren
Paulo office. Benner end run

But the biggest move may have come yesterday, when The Blackstone Group agreed to acquire
40% of Pátria Investimentos, a Sao Paulo-based investment firm with $3.7 billion in assets under Duff Is Wall Street Twice the
McDonald Size it Should Be?
management. The deal will give Blackstone a ready-made team in Brazil, where it's never done a
deal. For Pátria, it means the flexibility to do much larger transactions.

With the exception of size, the two firms look like mirror images of one another. Both founding Hedgeye Japan: the next global
time bomb?
teams previously worked within investment banks, and used private equity as an anchor to launch
real estate, hedge and corporate advisory practices. Pátria also has a thriving infrastructure
practice, while Blackstone is in the midst of raising its own dedicated infrastructure fund. Allan Stocks: So far from
Sloan their highs
"We began having relations with them on the advisory side around ten years ago, when Pátria was
being bought and sold out of banks," explains Blackstone spokesman Peter Rose. "It's a great
cultural fit and, in hindsight, maybe we would have partnered earlier." Nin-Hai David Rubenstein: U.S.
Tseng is losing its
Pátria will continue to manage its own portfolio, and make decisions on new deals in Brazil. competitive edge
Blackstone has the option to co-invest out of its existing global funds, and may be asked to
fund opportunities that Pátria cannot afford. Shawn Meredith Whitney's
Tully new target: The states

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Is Brazil the next big thing for private equity? - The Term Sheet: Fortune's... http://finance.fortune.cnn.com/2010/09/30/is-brazil-the-next-big-thing-for-...

Becky Make love not debt

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