[IMPORTANT: Make this 4 times longer with much more detail]
Brazil’s largest companies are catching global investors’ eyes given their finances are healthy and outlooks are promising, according to a leading emerging market investor. But issuers such as Vale and Petrobras say are in no hurry to raise capital. With the specter of US tariffs hanging over Mexico and others in the region, Brazil is currently an attractive destination for corporate debt investors, according to Celina Apóstolo Merrill, the head of EM corporate debt at BlackRock. Speaking at LatinFinance ‘s Latin America Capital Markets Summit 2025 in New York on Thursday, she said investors will be looking closely at the risks presented by each country, and Brazilian corporates stand out. “In Brazil there are great companies, great balance sheets, great fundamentals. Many macro funds are actually buying corporates and not sovereign in the local market,” Merrill said during a panel discussion. “This will be a year of country selection, security selection and sector selection, and this really brings Brazil to the forefront,” she added. Merrill noted that in Asia, where fundamentals are strong, valuations are very tight and geopolitical risks are an important factor, as they are elsewhere. Latin America, however, does not carry the same kind of risk. “When we turn to Latin America, we also see great balance sheets in several companies. In fact, balance sheets have not been as strong since 2004,” Merrill said. “From a valuations perspective, they are little bit cheaper than their counterparts in Asia. That is very attractive for us.” NO DEAL But while Brazilian issuers such as Ambipar, Bradesco and Usiminas have graced the international market this year, others are in no rush to do so. Cesar dos Reis Rosa, the head of Treasury at Petrobras, said the state-controlled oil firm spent the past eight years sorting out its debt after it climbed as high as $100 billion, and it is now in a much stronger financial position. That means that not even a drop in oil prices is likely to force Petrobras to tap global markets if the situation is not ideal for the company. “We can fund capex with our own operational cash flow and still pay dividends, and we understand that rates will be higher for a while,” he said during the panel. “It is kind of boring and it bothers the banks, who would like to see more issuances, but that is how we intend to navigate this year.” Meanwhile, Patricia Rodrigues, the global treasurer at mining giant Vale, said the company carried out significant liability management last year, but there are no currently no plans for a similar exercise in 2025. “We will continue to monitor the market, but we do not see an immediate situation like the one we had last year,” she said. “It will depend very much on projects and conditions. For corporate purposes, we will need to make sure we have the good scenario that makes total sense for us.”
