Brazil

Petrobras takes the drama out of its crisis

11 August 2017

The state-controlled oil company has often resembled a character in one of Brazil's more lurid telenovelas: blessed with great potential, but profligate and easily corrupted. Second-quarter results, though, tell a dull but encouraging tale of rehab under CEO Pedro Parente.

Brazil’s Congress discounts cost of corruption

3 August 2017

Lawmakers voted to shield President Michel Temer from criminal trial, at least for now. The calculus set immediate economic interests, which should benefit from the decision, against the longer-term merits of tackling political graft. Call it the net present value of shame.

Brazil pork mongers find comfort in flip-flops

31 July 2017

Selling trendy sandal maker Alpargatas to wealthy banking families will help meatpacking-to-pulp firm J&F pay a huge fine for bribing politicians. The original purchase, from a company also embroiled in scandal, is being probed by authorities too. It's a Brazilian microcosm.

Carrefour unit shows way to Brazil IPO revival

19 July 2017

The French supermarket chain’s local unit raised $1.6 bln in the country’s biggest stock offering in four years. Rising deal flow suggests growing confidence Latin America’s largest economy is getting back on track. But the recovery’s pace is tepid, and sensible pricing is key.

Lula graft conviction is a sad boon for Brazil

12 July 2017

At his popular peak, the ex-president offered a magical moderate leftism that both markets and the poor could love. He hoped to regain power in 2018. Positive investor reaction to his prison sentence shows how dead that dream is. Brazilians face harder, more realistic choices.

Brazil shambles toward zombie rule

27 June 2017

President Temer probably can cling to his job despite corruption charges leveled by the country's top prosecutor. His focus on survival, however, is apt to sap life from much-needed efforts at fiscal restraint. Semi-paralysis will be the state of play until 2018 elections.

Brazil’s economy teeters at the abattoir gates

23 May 2017

Laws and sausages alike are famously messy to make. That Brazil's President Temer, a master of the dark legislative arts, may lose his job over meatpacker JBS's corruption charges is perhaps fitting. But pension reform still needs forcing through Congress, whoever's in charge.

Water investors will get used to cash calls

19 May 2017

Shares in Sao Paulo utility Sabesp plunged on news it may raise equity for post-drought projects. But its funding needs and already high leverage were no secret. With the global water sector requiring $10 trln of investment, this Brazilian capital raise won’t be the last.

Brazil’s corruption vortex engulfs reform hopes

18 May 2017

President Michel Temer has improved economic headlines, for example pushing inflation below 4.5 pct. Now he's implicated in the wider bribery scandal enveloping his government. A 10 pct drop in the stock market reflects fear that his unpopular but effective policies are on hold.

Santander tames its troublesome triplets

26 April 2017

Brazil and Spain have become less of a challenge for the Madrid-based lender. The UK, which could turn problematic, hasn’t yet. Santander is treading cautiously despite a 14 percent quarterly earnings increase – which is wise, because the benign environment is still fragile.

Brazil’s Temer steers white-knuckle reform route

17 April 2017

The "Car Wash" corruption probe is increasingly denting the president's government as he tries to drive crucial changes to an unsustainable pension system through Congress. The nation's economic recovery may hinge on his ability to ease off the gas just enough to ensure passage.

Oil giant Petrobras leads Brazil out of the mire

22 March 2017

A rotting-meat scandal is the latest corruption mess to stink up Brazil’s reputation. But an earnings revival at the country’s state oil firm, whose kickback woes helped create the stench, shows reforms are bearing fruit. Sweeter smells of recovery should follow.

Complexity blunts AB InBev’s cost-cutting flair

2 March 2017

The mega-brewer expects savings from its SABMiller tie-up to reach $2.8 billion, 14 percent more than its initial estimate. Yet the upgrade is significantly smaller than it managed with previous deals. Taking on ever-bigger targets is testing its knack for squeezing expenses.

Latin America trumps populism – for now

22 February 2017

Ecuadoreans denied a first-round election victory to their leftist president's chosen successor. As in Brazil and Argentina, that opens the door to a traditional pro-business candidate. But growing U.S. demagoguery gives the region's politicians an excuse to ramp up nationalism.

3G chews over next big move with side of nuggets

21 February 2017

Fresh from pulling Kraft Heinz's bid for Unilever, the Brazilian investor group's restaurant roll-up pounced on fried-chicken chain Popeyes. With this $1.8 bln appetizer, Burger King's bosses get to apply their cost crunching to fast food while settling on a big new target.

Kraft Heinz has to settle for marinating Unilever

19 February 2017

The ketchup-and-cheese giant withdrew a $143 bln bid for its Anglo-Dutch rival after an inopportune leak put British politicians' knickers in a twist. But the idea of pairing 3G's ruthless cost management with Unilever's bent for innovation is embedded in shareholders' brains.

Heineken’s Dutch courage on Brazil looks merited

20 January 2017

The brewer may buy Kirin's Brazil unit for a mooted $872 million. The deal would give the company a 20 percent share of a difficult market, still well behind dominant AB InBev. The target is loss-making, but Heineken has reason to believe it can do a better job.

Brazil, Mexico to ramp up pro-market oil makeovers

4 January 2017

State-controlled energy behemoths Petrobras and Pemex, which owe more than $220 bln between them and face falling crude output, need help doing their jobs. Mexico's auctions of exploration rights show a business-friendly way forward. Brazil will try to catch up in 2017.

Latin America’s rightward turn faces serious tests

22 December 2016

Several countries in the region have shunned leftist populism of late. But the pain from economic reforms in Argentina and Brazil could make voters reconsider, if it's not accompanied by growth. And Chile's consensus on fiscal prudence may unravel.

3G will take another bite of Corporate America

15 December 2016

The Brazilian investors behind AB InBev and Kraft Heinz look poised for another mega-deal in 2017. After a failed bid for Hershey, Mondelez makes for a hefty, attractive $66 bln target. Kellogg and General Mills could also be tempting if the Oreo maker proves too big to digest.