Institutional investors expect Latin America excluding Brazil to be the most attractive region for private-equity deals over the next year, according to a survey by the Emerging Markets Private Equity Association.
The region climbed from fourth place a year ago, while Brazil, the top market in the 2011 survey, fell to second. China and emerging Asia were third and fourth. Empea surveyed 106 institutional investors between December 2011 and February 2012.
“There has been a significant amount of capital going into Brazil over the last 24 months and less going into other markets in Latin America,” said Sarah Alexander, chief executive officer of Empea. “This implies this area is almost virgin territory for deal-making,” she added.
The survey found that 54 percent of investors plan to expand or begin investment in Latin America, excluding Brazil. Southeast Asia came close behind with 53 percent planning to expand or begin investments in the region.
In contrast, Central and Eastern Europe was ranked by institutional investors as the least attractive region for private equity deals. The region may see some impact from the sovereign-debt crisis, said Alexander.
The survey found that global market volatility had little to no impact on investors’ plans to increase their commitments to emerging markets. Three-quarters expect their commitments to emerging markets to increase over the next two years.