Multilatinas have progressed substantially since the year 2000. A few new ones emerged, many others increased their regional presence, and some consolidated their global status. The international situation, now less favorable than in the past, and the realities of the Economy 4.0, have set new challenges and opportunities for the multilatinas of the future. Latin Trade consulted experts to discuss the issue.
The region's 100 largest nonfinancial multilatinas with stock exchange listings generated $1.05 trillion revenue in 2018, according to an analysis by Latin Trade economists. Three quarters of this came from the oil and gas sectors (27% of the total), retail (15%), food and beverages (15%), energy generation (9%), and telecommunications (9%).
While these five sectors also represented about three-quarters of total revenues of multilatinas in 2009, it is noteworthy that the retail and food and beverages sectors were able to increase their participation over the past 10 years while others, such as telecommunications, shrinked.
The trend reflects the merger and acquisitions activity in the industry, while the expansion of sectors such as food and beverages and retail were related to the boom in mass consumption.
In addition, figures show the growth of activities such as software and agribusiness, which were not even on the chart 10 years ago.
Geographically, the Latin Trade analysis shows the number of multilatinas headquartered in Brazil declined by 11 between 2009 and 2018, basically as a result of mergers and acquisitions. At the same time, the number from Mexico increased by four, from Colombia and Peru by three each, and from Chile by one. Argentine companies remained unchanged at six. At the close of 2018, Mexico, Brazil, and Chile were still dominant, albeit with a reduced combined share, with 82% of the total of multilatinas compared with 88% in 2009.
A study published in early 2018 by The Boston Consulting Group (BCG) confirmed the dynamism of multilatinas in recent years. It found that the revenues of the 100 largest, including financial companies and some that are family owned, grew at an annual average rate of 5.2% in dollars between 2008 and 2016. That was three times faster than the average for the largest companies in Latin America and the Caribbean.
The success of multilatinas is based on their ability to overcome a wide range of obstacles--including regulatory, institutional, and logistical. But it also reflects strategic...