By Pablo Lacobelli, and Jaime Coutts – Carey y Cia
1. What main trends do you anticipate will shape the M&A landscape in 2025, especially in terms of industry focus and geographic activity?
Pablo Iacobelli and Jaime Coutts (Chile):Â During 2025, the recovery of M&A activity in Chile should continue, so we anticipate a very good year, with a focus on medium-sized transactions and some signs of recovery in the capital market as well.
Although the Chilean economy’s growth projections for 2025 are modest, and the global geopolitical situation is worrying, confidence in Chile as an attractive place to invest and the resilience of the Chilean economy remain key factors in anticipating interesting levels of foreign investment.
The sectors or industries that could see the greatest activity could be, among others, mining, energy, agribusiness, infrastructure, data centres, logistics and transport.
2. How do you expect changes in regulatory frameworks to impact M&A activity in 2025, especially with the evolution of antitrust laws and international trade agreements?
Pablo Iacobelli and Jaime Coutts (Chile):Â Chile is very active in terms of relevant regulatory reforms in different areas, which will undoubtedly impact M&A activity in different ways.
For example, during 2024 a new cybersecurity law was enacted that imposes obligations in this area on a large group of companies, which may impact the due diligence processes that will have to incorporate reviews to this effect, if applicable.
Likewise, a new data protection law was also recently enacted. Although this law establishes deadlines for its full implementation, we should start to see a trend, especially among sophisticated global buyers, towards carrying out more in-depth reviews in this area to pave the way for the new requirements that this law will impose.
Similarly, in Chile we are also seeing a lot of new regulation in labour and tax matters that could also impact M&A processes. On the other hand, we do not anticipate any significant changes in antitrust or international trade agreements.
3. Given current economic conditions, what factors do you expect to influence company valuations in M&A transactions in 2025?
Pablo Iacobelli and Jaime Coutts (Chile):Â We believe that the local market has stabilised and valuations should continue to recover, influenced, moreover, by a growing weakening of the local currency that should attract more foreign investment and activate M&A processes.
4. How will advances in technology and digital transformation drive mergers and acquisitions strategies in 2025, especially in sectors such as healthcare, finance and technology?
Pablo Iacobelli and Jaime Coutts (Chile):Â A very powerful effect that we have noticed in Chile is the exponential growth of investments in data centres, which we believe is a trend that is here to stay, especially considering the current hyper-digitisation at the Chilean and global level.
In this sense, we believe that the phenomenon will continue – and even grow – in 2025, both with international players who will come to set up directly with operations in Chile from scratch, as well as investors who will look for investment opportunities in this industry through M&A transactions.
Likewise, we also anticipate for 2025 an interesting appetite for investment in the healthcare sector related to care and treatment for the elderly (as an effect of the ageing population and the sustained growth in life expectancy), as well as in the software industry that allows companies to automate and digitise processes that bring efficiencies to their operations.
5. What changes do you foresee in financing options and deal structures by 2025, especially in light of fluctuations in interest rates and capital market conditions?
Pablo Iacobelli and Jaime Coutts (Chile):Â The Chilean Central Bank has promoted a fall in interest rates, but at a slower pace than projected, influenced in part by inflation, which has also failed to fall to expected levels. This slight drop in interest rates, together with greater political stability (especially with the conclusion of the constituent processes of the last 5 years), have had a positive effect on the local financial market, which has become more open to those seeking financing.
Therefore, we believe that in 2025 access to financing will be greater, and that debtors will be able to opt for better conditions than in 2024.
As for the debt capital market, in general, the outlook in Chile for 2025 is good, with a possible reactivation of debt issues thanks to economic stabilisation and a possible partial reduction in interest rates, as mentioned above.
Likewise, sustainable issues are expected to continue to increase, driven by demand from investors focused on ESG criteria.
Finally, we do not expect major changes for Chile’s equity capital market in 2025, where more than 5 years have already passed since the last IPO in our country.
Previously published in Latin Counsel’s M&A Outlook 2025
