Fund plans to invest $500m to $1bn in next three years in data infrastructure opportunities
12/14/2022
After the sale of the data center company Odata to the American Aligned, Pátria Investimentos fund, which held about 90% of the company’s capital, now seeks to expand its technology portfolio, with a focus on infrastructure for 5G networks.
“In three years, we will invest $500 million to $1 billion in data infrastructure opportunities,” said Felipe Pinto, partner at Pátria, in an interview with Valor.
Among the 42 companies in Pátria’s current portfolio, 19 of which are infrastructure companies and 23 are private equity, Winity — created in 2020 to provide infrastructure to wireless networks — is currently the fund’s only technology company.
The idea, according to Mr. Pinto, is to expand Winity’s operations beyond the Brazilian market and seek new investments in Latin America, with an eye on the expansion of 5G networks in countries like Colombia, Peru, and the Central American region.
Winner of the national lot of the 700 MHz band in the frequency auction for 5G offering in the country last year, Winity is awaiting approval from the antitrust regulator Cade on a network sharing agreement signed with Telefonica (Vivo) in August. “We are confident that we will go through the approval processes normally,” said Mr. Pinto.
The fund says it is interested in investing in data infrastructure companies to meet corporate demand for 5G networks. “We look at the potential infrastructure that can serve companies in the agricultural, mining – including mining complexes in Chile –, healthcare, and industrial plants among others,” Mr. Pinto said.
In addition to investing directly in technology companies, for two years Pátria has been digitalizing companies from other segments in its private equity investment portfolio.
According to Ricardo Barbosa, Pátria Investimentos’ Digital Transformation and Value Creation Private Equity Portfolio Leader, the goal is to increase EBITDA and raise the forward enterprise value-to-EBITDA multiple of these companies, in addition to generating business through digital transformation.
One of the examples cited by the fund is the agricultural resale platform Lavoro, which is preparing to carry out an IPO on Nasdaq. As Valor’s business website Pipeline reported in September, Lavoro will go public through a merger with TPB Acquisition Corporation, a special purpose acquisition company (SPAC) sponsored by investment firm The Production Board. In the deal, the Brazilian company was valued at $1.2 billion.
Today, 23 companies in Pátria’s private equity portfolio are in digitalization projects led by Mr. Barbosa’s sector, including database migrations to the cloud and production chain robotization.
In October last year, the fund also identified a space to invest in information security by announcing the purchase of cybersecurity companies Neosecure and Proteus for the markets of Argentina, Brazil, Chile, and Colombia. At the time, the fund committed to injecting $250 million into the sector.
The manager informed on Tuesday that the sale of Odata to Aligned and of the concessionaire Entrevias, announced at the beginning of the month to the French company Vinci, is expected to generate a gain of approximately $1.4 billion for the shareholders of Pátria Infraestrutura III fund. In the case of Entrevias, Pátria is selling a 55% stake and the fund will continue with the remaining 45%.
*By Valor — São Paulo
Source: Valor International