At a time when private equity funds are facing difficulties in raising new capital and are adopting a more conservative stance, strategic investors are 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 acquire rivals or build positions, without necessarily moving immediately to take control.
Transactions of this type have been gaining momentum in recent years. A survey conducted by Seneca Evercore for NeoFeed found that the relative participation of strategic investors compared to financial investors in private M&A transactions increased from 88% to 93% between 2021 and the first half of this year.
And what we are seeing is that these investors are also moving forward 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 of so-called dry powder — the capital available for new investments by private equity funds — has made strategic investors more competitive in the bidding for assets.
“Since there are still many companies in private equity portfolios and fewer resources returning to investors, the volume of capital available for investment has decreased. And when that happens, funds become much more selective,” says Rodrigues.
An analysis conducted by Bain & Company in partnership with ABVCAP shows that, last year, 11 exit operations were recorded by private equity funds, down from 17 in 2024 and 27 in 2021. The survey analyzed a sample of operations that excludes complementary 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, this period increased 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 difficult for investors to return funds and for many asset managers to raise new capital, causing funds to be more rigorous with entry prices and transaction conditions given the current market circumstances, in order to guarantee good return potential.
Strategic buyers, on the other hand, benefit from having more flexibility, allowing them to justify higher valuations due to the operational synergies and market gains they see in acquisitions.
“Private equity tends to want to pay a little less in more challenging times. Strategic investors, on the other hand, may accept a higher valuation because they are looking at market share, synergies, and business growth,” she says.
Fishing in the Stock Market
The current market conditions are also leading strategic investors to look more closely at publicly traded companies. The Brazilian stock exchange , at historically low levels, combined with lower market liquidity, has created opportunities for these buyers to invest in publicly traded companies.
“What is remarkable is that a trend is beginning for listed companies to become targets for strategic investors,” says Danilo Borges, head of M&A and Financial Sponsors at Bradesco BBI .
And the interest is going beyond classic takeover transactions, as happened recently with Mills, acquired by the French group Loxam, and with Desktop , which was sold to Claro.
Strategic investors have also been building significant positions in listed companies in recent years. A recent example is the Muffato family, owners of a supermarket and wholesale chain in Paraná, who last year acquired a 10% stake in Assaí . Another example is the founder of Inpasa , José Odvar Lopes, whose 10% investment in Vibra was approved by CADE in February.
According to Borges, the explanations for these movements range from purely financial plays , motivated by knowledge of the sector and the perception that the company is undervalued, to strategies to initially gain a better understanding of the asset, culminating later in its acquisition.
This was the case with Grupo Globo and Eletromidia . The largest media company in the country began building a stake in the out-of-home media company in 2023 and progressed to acquiring control in 2024.
The assessment is that the increased sophistication of the Brazilian capital market has also broadened investment opportunities, allowing for more complex structures for acquiring significant stakes, thus facilitating these transactions.
This also aligns with the current profile of companies listed on the stock exchange, with many of them lacking a clearly defined controlling shareholder. This has created a larger universe of leading companies in their segments that can be targeted by investors interested in building significant positions.
The combination of this characteristic and depressed valuations creates favorable conditions for this type of movement, according to Borges, which should stimulate more deals of this nature.
"It's a case of hunger meeting the desire to eat. You have strategic assets available and a market that isn't pricing these companies appropriately," says Borges.
Still in the activity
Despite the rise of strategic funds, private equity funds are not standing still. In addition to caution and the need to manage fewer available resources, managers have also had to change the composition of their strategies, according to Anderson Brito , head of investment banking at UBS BB .
According to him, Brazil has been following a global trend, with large asset managers directing a growing portion of their resources to 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 Bain's research with ABVCAP shows that, last year, funds made 32 new investments for 2025, up from 24 in 2024, a sample that excludes complementary acquisitions, real estate, or infrastructure assets.
Another survey by ABVCAP, conducted in partnership with TTR and with a larger sample size, indicated that the industry ended 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 asset manager IG4 Capital , worth around R$ 20 billion. Furthermore, the figures for the different years only consider transactions whose numbers have been made public and information provided by advisors.
While some traditional vehicles are finding it more difficult to raise funds, strategies linked to digital infrastructure, data centers, energy, and structured credit continue to attract capital, as well as assets classified as special situations .
“When you add traditional private equity, infrastructure, and other alternative strategies, the volume of capital remains very robust,” says Brito. “The big global trend is the diversification of alternative investments. That’s the structural change we’re seeing.”
This preference for certain investment strategies is compounded by the decisions of many managers to reinvest in companies they already own, instead of seeking new acquisitions.
According to Rodrigues, from ABVCAP, several funds have opted to make additional investments in assets they know well, reducing the execution risks associated with new investments.
She points out that this is a trend that doesn't always show up in the statistics, since many of these investments are made directly between the fund and the company.
"There are managers who look at their companies and conclude that it is more worthwhile to put more capital into an asset they already know than to start a new investment thesis," he says.
