Tuesday, December 28, 2010

Brazilian Companies Plan Big Global Expansions

While the 2008 financial crisis that still shakes some of the world's major economies, it has not shaken the plans for the global expansion and internationalization of Brazilian companies. In fact, the difficult global conditions of the last couple of years have led these companies to be more aggressive.
Jose Carlos Martins, Vale´s director of the  for ferrous division,  is optimistic about the international expansion for 2011. The effort will be greater in Africa. "It's where everyone is looking at mining,".

Interesting, because Africa is exactly where I intend to invest and will be having a very close look.
Mr. Martinez has been closely following the expansion of consumption in the Chinese and Indian markets and in nearby countries such as Indonesia and the Philippines. Vale is oriented to the Asian market: 70% of exports go to the mainland. He says that the Middle East is another region with great potential. To meet the increased customer base, the mining company recently invested in acquisitions and new operations, such as phosphate mine opened in the middle of the year in Peru.
Another giant in its sector, Odebrecht also has ambitious goals in 2011. The company plans to begin operations in a new country in Central America next year, says Luiz Mameri, superintendent of Odebrecht for Latin America and Angola. 

"In these markets you can feel that there is more liquidity. Some countries are easier to access  in terms of international financing for infrastructure. This has direct bearing on our business," he explains.
Our favorite Sadia, which merged with Perdigao to create Brasil Foods (BRF on the NYSE), a global food giant,  was a pioneer in the internalization in the food sector, currently with offices in over 40 countries, Brazil Foods has aggressive plans for 2011, says Wilson Melo, vice president of Corporate Affairs at BRF. "We are in several African countries, but there is potential to increase sales and open markets in the continent," he says. According to him, the other major challenge will be to sell more products with higher added value.
Metalfrio, a large manufacturer in refrigeration sector,  gives as certain the company's expansion to Asia, says President Luiz Eduardo Moreira Caio, who is studying a plant in Southeast Asia. "We are in search of emerging markets with growth potential. The phase of finding low priced assets is over, but we have a powerful cash generation to enjoy new opportunities".

Keep an eye on Africa. Brazilian - and Chinese - companies are there.

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1 comment:

Deming said...

Credit Suisse report this a.m. mentions "China's State Grid Corporation is buying seven Brazilian power transmission companies and has won a 30 year concession to operate power infrastructure in the more populous parts of the country."

Any news there on it?

Enjoy your visit!


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