English Group buys Brazil Trade Shows
Valor Econômico
Brazil Trade Shows (BTS), third largest trade show organizer of the country, was sold for R$ 200 million (US$ 125 million) to the English Informa Group, with 1.2 billion Pounds (US$ 1.9 billion) in earnings and operations in 43 countries. After three weeks of negotiations between the private equity fund DJL South American Partners, owner of BTS, and the command of the Informa Group, the contract was signed last Tuesday at the office of Pinheiro Guimarães Advogados. The announcement of the operation was planned for today.
The new company, which may be called BTS Informa (the name has not yet been defined), will be the largest company in Brazil in the segment of events. It has potential to hold 500 conferences, seminars and trainings a year, besides organizing 19 annual trade shows like the Fispal and the ABF Franchising. In trade shows, however, the leadership continues with Reed Exhibitions Alcantara Machado, joint venture established in 2007 between the English Reed Exhibitions and the Brazilian Alcantara Machado. Reed holds 52 shows a year in Brazil. The company that arises from the merger between BTS and Informa holds the second place in the ranking of organization of trade shows, followed by United Business Media Limited, with 14 trade shows a year.
A few strategic moves of the companies are evident with the negotiation. DJL fund leaves the investment after four years with the asset in the portfolio, after having finished the adjustments in the management and professionalized the business. "That was all done faster than we imagined. Instead of leaving the it in eight or nine years, it was possible to disinvest in half the time", says the President of BTS, Alexandre Barbosa. As regards the Informa Group, it moves in an attempt to broaden its structure in the country and seek new sources of income, after the timid global expansion in recent years. In 2010, the Informa Group grew 0.4% as it reached sales of 1.2 billion Pounds in different areas, such as publications, consulting and events. But most of worldwide earnings are obtained in markets considered mature.
According to the General Director of the Informa Group Latin America, Marco Basso, the United States and Europe are responsible for nearly 80% of the earnings of the company in the world. "We needed to diversify the operation in geographic terms. Among the emerging countries we want to grow quickly, Brazil is a priority", he says. The sum of R$ 200 million (US$ 125 million) invested in the purchase of BTS is the largest ever paid in the acquisition by the multinational in an emerging country. According to Basso, the company continues open to new acquisitions in the country. The segment generates between R$ 4.5 billion (US$ 2.8 billion) and R$ 5 billion (US$ 3.1 billion) a year in the country, according to sources of the sector, and the expectation is that the market grows 20% in Brazil this year, calculates the leader Reed Exhibitions Alcantara Machado.