brazil report 2007

E commerce according to analysts e retailing revenues

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: The number of internet users in 2006 is estimated at 15.7 million, an increase of 16.4% or 2.2 million people, according to Ibope Net Ratings. But analysts estimate the number of potential internet users at 70 million people. Attracting these users is key to boosting e-commerce sales. The confidence in the payment system is an important part of this attraction process and initiatives like e-shopping through mobile phones are perfectly aligned with the concepts of mobility and agility intrinsically connected to internet. M&A activity The first half of 2006 has shown an important reaction in the mergers and acquisitions (M&A) activity in Brazil. The number of deals in this period was 35% higher than in the same period of 2005, with 241 transactions against 178 in the first semester of 2005. The record was 321 transactions in the same period of 2000 which was however affected by a significant number of small e-business related transactions. This increase in the number of deals was expected since financial and corporate investors have realigned their investments; industries have concentrated and consolidated in search of synergy; private equity funds, both existing ones and new entrants, have made new investments, but there have also been some exits; new strategic players have entered the Brazilian market; and the economy continues to show signs of future growth and is expected to attain the investment grade level. The breakdown of the transactions has shown that sectors such as IT, food and beverage, chemical and petrochemical and financial institutions have historically been positioned between those which show a higher number of deals. Together, these sectors have normally accounted for 35-45% of the total number of transactions. 20 2006/2007 FROM SÃO PAULO TO SHANGHAI New consumer dynamics: the impact on modern retailing* Brazil Retail and consumer sector Food and beverage and retail sectors have accounted for 54 deals in the first half of 2006, which is almost equivalent to that for the whole year of 2004 with 56 transactions, and represents 70% of the total transactions of 2005 in these sectors. The transactions in the juice segments and between retailers and financial institutions have accounted for the number of the deals in retail and consumer sectors. In monetary terms, the acquisitions of Sonae and Bompreço by Wal-Mart, the transactions between Casino and Companhia Brasileira de Distribuição and the acquisition of Quilmes by Ambev, were valued at BRL3.1 billion. Major transactions year Acquirer company Target company Segment 2006 Bertin Cooper Cosmetics & personal care 2006 Ambev Quilmes Beer 2005 Casino Companhia Brasileira de Distribuição Supermarket 2005 Wal-Mart Sonae Supermarket 2005 Capital International Magazine Luiza Home equipment & furniture 2005 Coteminas Springs Textiles 2005 Assolan Quimivale Household cleaning products 2004 Wal-Mart Bompreço Supermarket 2005 Coca-Cola Sucos Mais Juice 2005 Friboi Swift Armour Meat 2005 Cargill Emegê Flour mill 2004 Cargill Seara Alimentos Poultry 2004 Tereos Açúcar Guarani Sugar Source: PricewaterhouseCoopers Corporate Finance – Brazil 21 2006/2007 FROM SÃO PAULO TO SHANGHAI New consumer dynamics: the impact on modern retailing* Brazil RETAIL AND CONSUMER CHALLENGES, OPPORTUNITIES AND EMERGING TRENDS CHALLENGES Rising competition As a result of the concentration process, large international retailers have strengthened their market-shares. Organicall...
View Full Document

This document was uploaded on 02/14/2014 for the course MBA MBA at SPSU.

Ask a homework question - tutors are online