Heritage Capital Joins List Of Latest Brazil-Focused Boutiques
SAO PAULO -(Dow Jones)- London-based Heritage Capital officially joined a
short, but growing list of boutique financial advisory firms in Brazil this week
and hopes to tap its international connections to bring value to its mid-market
strategy.
"A lot of big Brazilian companies have no problem getting access to short-term
capital, but there is almost no access for mid-market companies and we think we
can tap international markets for that segment," said Glenn Peebles, a former
director at Dresdner Kleinwort and now managing director of the new Heritage
Capital Latin America do Brasil in Sao Paulo.
The bank's London CEO Joseph Dyer said the firm was non-product focused and
will stick to a merchant bank advisory model for mid-market companies with
revenues of 100 million Brazilian reals ($58.8 million) to BRL150 million. Dyer
said the Brazil office will be an advisory firm for foreign clients of
Heritage's new Turkey branch, as well as the more established London and
Singapore branches who wish to break into Brazil through private equity
investments in similar Brazilian companies, or other cross-border financial
deals.
"We are convinced that there is going to be an increasing amount of Chinese
capital in particular looking for places to go. They aren't really going to go
to Russia and India because the government's aren't as friendly to one another.
They are going to go, however, to Africa and Brazil," Dyer said.
Heritage Capital Latin America, based in New York, recently completed a road
show to sell three to five year debt for a Brazilian, privately held ceramics
company to U.S. hedge funds.
"The big name Brazilian equity and debt are more institutional plays now. The
middle market and the unknown names with bigger returns are what hedge funds are
looking at again," said Enrique Bustamante, head of Latin America in New York.
Heritage's entry into Brazil traces a string of private banking names that
have sprung up over the last year. Most of them have made deals with larger
institutions to help tap international credit markets for Brazil's mid-cap
companies.
In January, for example, Japanese investment bank Nomura struck up a deal with
Rio de Janeiro based Orienta Investments to act as its local investment banking
advisor for Brazilian M&A deals.
Last year, another Brazil mid-market investment bank, G5 Advisors, signed a
partnership agreement with U.S. mergers and acquisitions company, Evercore
Partners Inc. (EVR).
BTG Pactual and MTTG Holding SA, both mid market advisors, traders, and wealth
managers, rose from the ashes of the European banking crisis. Wealthy Brazilian
bankers acquired part of UBS AG (UBS) and Dresdner Bank to create BTG and MTTG,
respectively, with the idea of expanding into mid-market corporate finance and
M&A.
-By Kenneth Rapoza, Dow Jones Newswires, 5511-2847-4541, kenneth.rapoza@
dowjones.com
(END) Dow Jones Newswires
11-25-090717ET
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