Energy will remain the flagship of mergers and acquisitions in Brazil, says UBS
The energy sector is expected to continue as the main driver of the mergers and acquisitions (M&As) market in Brazil in the coming years. The assessment is from the head of investment banking at UBS BB, Anderson Brito, who highlights the relevance of the segment for local and foreign investors and the volume of opportunities in areas such as electricity, sanitation and oil and gas.
According to the executive, the so-called "power and utilities" segment (which encompasses electricity, sanitation and oil and gas) accounted for approximately 40% of the total volume of mergers and acquisitions registered in the country in the last decade.
"In 2025, we had around US$50 billion in M&As for the country. And the energy sector, including power and utilities and oil and gas, had 40% of this volume. Something around R$120 billion", he said in an interview with CNN's Alta Voltagem program.
For Brito, the sector's protagonism is supported by the combination of large international groups already established in the country with Brazilian companies with strong operations. Among global investors, he mentions Iberdrola, Enel, EDF, EDP, State Grid and China Three Gorges (CTG). On the national side, it highlights companies such as Eneva, Áxia (formerly Eletrobras) and Equatorial.
The executive states that activity will remain strong in 2026, not only in mergers and acquisitions, but also in capital market and financing operations.
"When we look at the numbers for 2026 in relation to those for 2025, we see relevant transactions, from the point of view of mergers and acquisitions, but also from 'equity' and 'capital markets'. There are several transactions being priced and even more from the point of view of local debt and international debt", he said.
In the banker's view, Brazil continues to be a relevant destination for foreign investors, despite challenges linked to legal and exchange rate volatility. "For international investors, Brazil is a relevant, predictable geography, but has some volatility, mainly from a legal and exchange rate point of view", he stated.
Greater attractiveness
Among the segments with the greatest potential, Brito believes that hydroelectric plants will continue to attract interest from investors due to operational predictability, the consolidated history of the technology and the presence of several global groups specializing in this type of asset.
Recently, EDP sold three hydroelectric plants and Engie approved the share offering to acquire part of the Jirau hydroelectric plant.
The oil and gas sector also remains on the radar. The executive cites recent movements, such as the acquisition of control of Brava by Ecopetrol and the purchase of Raízen's operation in Argentina by Mercuria, as examples of a market that remains dynamic in the face of the global oil scenario.
Sanitation remains active
In sanitation, the expectation is also for strong activity in the coming years. According to Brito, the country has a significant volume of investments already contracted and a favorable environment for new projects.
"We have a level of sanitation capex contracted for Brazil of approximately R$900 billion for the next six or seven years and the level of sanitation penetration is still low in the subsegment. Furthermore, there are several privatizations coming in the pipeline and successful privatizations, such as Sabesp and Copasa", he stated.
According to the executive, the segment also has factors that reinforce its attractiveness for investors, such as the availability of financing, government support and the strengthening of the regulatory environment.
"There is an appetite from banks to provide financing in the subsegment, there is government support and a more robust regulatory environment", he concluded.
Source: CNN