Advent raises $2 billion fund for Latin American company bets

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SAO PAULO (Reuters) – U.S. private equity firm Advent International has raised a $2 billion fund to invest in Latin American companies, it said on Tuesday, its seventh focused on the region, hoping to target assets made cheaper by depreciation in local currencies.

The firm, which has been investing in Latin America since 1996, is eying 13 to 15 opportunities in financial services, healthcare, industrials, consumer and technology, mainly in Brazil, Colombia, Mexico and Peru.

Advent says it is targeting equity investments between $50 million and $300 million, which should lead it to deals bigger than those made by its previous funds in local currencies, as money in Latin America – mainly Brazil’s real – has devalued during the coronavirus pandemic.

The real is down nearly 30% against the U.S. dollar since the beginning of the year.

“It gives us firepower for bigger deals,” Patrice Etlin, a managing partner at Advent in São Paulo and member of the firm’s global executive committee, said in an interview. He added that the fund is 65% bigger in reais than the previous one, which was slightly bigger in dollar terms.

Reuters first reported that Advent was seeking to raise a new fund for the region last year.

Despite the recessionary outlook for Latin America due to the pandemic, Etlin said the region offers good investment opportunities. “In our current portfolio, we have seen a fast recovery from the worst of the pandemic.”

Etlin said the fund has been analyzing tech companies recently, as he considers the environment in Brazil attractive for such investments.

Earlier this month, Brazilian financial startup Nubank acquired Advent-backed broker Easynvest in a cash and stock deal that gave the private equity firm an undisclosed minority stake in Brazil’s most prominent fintech.

Last year, Advent launched a $2 billion dedicated tech fund and an office in Palo Alto, California, as part of its expansion in technology investments.