Strategic Buyers Are Taking Over from Private Equity Firms in M&A
- Seneca Evercore | Notícias
- Aug 7
- 5 min read
At a time when private equity funds are more cautious and seeking synergy in their portfolio companies, corporate buyers are hooking stakes in private and listed companies
At a time when private equity funds face difficulties raising new capital and are adopting a more conservative stance, the strategic investor is emerging on the buying side.
This group of investors, who make investments aiming not only for immediate financial returns but also for long-term strategic and operational advantages, is taking advantage of the moment to swallow up rivals or build positions, without necessarily moving immediately toward taking control.
Deals of this profile have been gaining ground in recent years. A survey conducted by Seneca Evercore for NeoFeed found that the relative share of strategic investors compared to financial ones in private M&A deals rose from 88% to 93% between 2021 and the first half of this year.
And what’s being observed is that these investors are also advancing in the stock market, at a time when multiples are at their lowest historical levels.
The president of the Brazilian Private Equity and Venture Capital Association (ABVCAP), Priscila Rodrigues, says that the reduction in what’s known as dry powder — the capital available for new investments by private equity funds — has made strategic investors more competitive in disputes over assets.
“Since there are still many companies in the private equity portfolios and fewer resources returning to investors, the volume of capital available to invest has shrunk. And when that happens, funds become much more selective,” states Rodrigues.
An analysis conducted by Bain & Company in partnership with ABVCAP shows that last year, 11 exit operations were recorded by private equity funds, below the 17 recorded in 2024 and the 27 recorded in 2021. The survey analyzed a sample of operations that excludes add-on acquisitions, real estate, or infrastructure assets.
The time companies remain in portfolios has also increased, according to the survey. Between 2018 and 2022, exits occurred, on average, after five years and three months between the investment and the liquidity event. From 2023 to 2025, that period rose to six years and three months. Last year, the number of exits as a percentage of the portfolio was 4%, below the 7% recorded in 2024.
According to Rodrigues, the situation makes it harder to return resources to investors and to raise new capital for many managers, causing funds to be more rigorous about entry prices and transaction conditions given current market circumstances, in order to ensure good return potential.
Strategic buyers, on the other hand, benefit from having more flexibility, being able to justify higher valuations because of the operational synergies and market gains they see in acquisitions.
“Private equity tends to want to pay a little less in more challenging moments. The strategic buyer, meanwhile, can accept a higher valuation because they’re looking at market share, synergies, and growth of the operation,” she says.
Fishing on the Stock Exchange
The market moment is also leading strategic investors to look more closely at publicly traded companies. The Brazilian stock exchange, at historically cheap levels, combined with the market’s lower liquidity, has opened space for these buyers to invest in publicly listed companies.
“What’s notable is that a trend is beginning of listed companies becoming targets of strategic investors,” says Danilo Borges, head of M&A and Financial Sponsors at Bradesco BBI.
And the interest is going beyond the classic control-purchase transactions, as recently happened with Mills, acquired by the French group Loxam, and with Desktop, which was negotiated with Claro.
Strategic investors have also been building relevant positions in listed companies in recent years. A recent case is that of the Muffato family, owner of a supermarket and cash-and-carry chain in Paraná, which last year built a 10% position in Assaí. Another example is the founder of Inpasa, José Odvar Lopes, whose 10% investment in Vibra was approved by Cade in February.
For Borges, the explanations for these moves range from purely financial plays, motivated by knowledge of the sector and by the perception that the company is cheap, to strategies to initially get to know the asset better, later culminating in its incorporation.
This was the case with Grupo Globo and Eletromidia. The country’s largest communications company began building a stake in the out-of-home media company in 2023 and progressed to buying control in 2024.
The assessment is that the greater sophistication of the Brazilian capital markets has also expanded investment possibilities, allowing more complex structures for acquiring relevant stakes, facilitating these transactions.
This also ties in with the current profile of companies listed on the stock exchange, with many of them lacking a clearly defined controlling shareholder. This created a larger universe of companies that are leaders in their segments and that can be targets of investors interested in building relevant positions.
The combination of this characteristic and depressed valuations creates favorable conditions for this type of activity, according to Borges, which should stimulate more deals of this nature.
“It’s hunger meeting the appetite to eat. You have strategic assets available and a market that isn’t pricing these companies appropriately,” states Borges.
Still Active
Despite the advance of strategic buyers, private equity funds aren’t sitting passively. Beyond the caution and the need to deal with fewer available resources, managers have also had to change the composition of their strategies, according to Anderson Brito, head of the investment bank at UBS BB.
According to him, Brazil is following a global trend, with large managers directing a growing share of their resources toward other strategies, such as infrastructure, private credit, and structured funds. “The global movement is one of diversification within the universe of alternatives,” says Brito.
Data from the Bain–ABVCAP research shows that last year, the funds made 32 new investments in 2025, above the 24 recorded in 2024, a sample that excludes add-on acquisitions, real estate, or infrastructure assets.
Another survey by ABVCAP, conducted in partnership with TTR and with a larger sample, indicated that the industry closed 2025 with a total of 89 investments, above the 72 recorded in 2024, but below the 113 operations of 2021.
In terms of value, the volume recorded in 2025 was R$50.1 billion, higher than the R$13.3 billion of 2024 and the R$21.8 billion of 2021. Last year’s data was heavily influenced by the effect of the transaction that transferred control of Braskem to the manager IG4 Capital, in the range of R$20 billion. Furthermore, the value across the different years considers only operations whose figures were made public and information provided by advisors.
While some traditional vehicles face more difficulty raising resources, strategies tied to digital infrastructure, data centers, energy, and structured credit continue to attract capital, along with assets classified as special situations.
“When you add together traditional private equity, infrastructure, and other alternative strategies, the volume of capital remains very robust,” states Brito. “The great global movement is the diversification of alternative investments. That’s the structural change we’re seeing.”
Adding to this preference for certain theses are the decisions of many managers to reinvest in companies they already hold in their portfolios, instead of seeking new acquisitions.
Published on 08/07/2026 and available at:
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