AIG Investments has announced a BRL60m million (USD38.6m) investment in Advento Participações, a specialty engineering services provider in Brazil,
AIG Investments has announced a BRL60m million (USD38.6m) investment in Advento Participações, a specialty engineering services provider in Brazil, with the option to invest an additional BRL20m toward the Advento group’s future expansion activities.
The equity investment will be funded by AIG Brazil Special Situations Fund II, a private equity fund focused on direct investments primarily in Brazil, Mexico and Colombia that closed in April with USD691.9m in committed capital.
With the investment, Advento Group will acquire Serpal Engenharia e Construtora, a Brazilian construction company with a 35-year track record of projects in the industrial and commercial sectors.
AIG Investments says the acquisition will establish Advento Group, which also controls three other engineering companies, Vecotec, Vox and Temar, as the only construction and turnkey engineering group in Brazil.
“The market for residential and commercial properties has developed significantly with 17 companies going public since 2004,” says Ana Vigon, managing director and head of Latin America private equity at AIG Investments. “The industrial segment is expected to follow similar growth trends driven by rapid capacity expansion, with Advento Group well positioned to capture this growth.”
Cristiano G. Lauretti, a managing director of AIG Investments, says: “The business model built by Advento Group will reduce inefficiencies within the traditional construction process and will offer complete technical solutions through the integration of both construction and engineering services.
“With these measures Advento Group will be able to use its integrated structure to simplify project execution and take advantage of synergies across complementary business lines.”
Juan Quirós, majority owner and chief executive of Advento Group, adds: “Our goal was to acquire a construction company to capture synergies with the existing companies and to leverage our entrance into new high-growth, high-potential markets.
“To achieve this goal we needed strong partners, without losing control of the business strategy. The partnership with AIG Investments will accelerate our expansion plans, enhance corporate governance, and shorten Advento Group’s internationalisation path.”
The investment in Advento Group will be the fourth for the Brazil Special Situations Fund II, following investments in Companhia Providência, a manufacturer of non-woven fabrics in Latin America, and Falcon Farms, an integrated grower and distributor of fresh cut flowers with production in Colombia, Ecuador and Mexico.
Most recently, AIG Investments announced an investment in Calyx Agro, a venture sponsored by Louis Dreyfus Commodities to acquire, develop, operate and sell agricultural land in Latin America, primarily in Brazil.
AIG Investments, the asset management arm of American International Group, has capabilities in equity, fixed income, hedge fund, private equity and real estate investments through member companies that managed more than USD758bn in assets and employed some 2,000 professionals in 46 offices worldwide at the end of June.
