Ultrapar, a Brazilian fuels distribution, chemicals production and logistics business listed on the New York and Sao Paulo stock exchanges with a market capitalisation of $5 billion (£2.7 billion), has acquired Texaco’s Brazilian fuels distribution business for approximately $730 million (£393 million).

This is further sign of a boom time for the Brazilian M&A market, which in the last two years has dramatically increased, generating almost 947 deals with a combined value approaching $97.3 billion (£52.4 billion).

David Sonter, Freshfields' country partner for Brazil, who advised on the deal, commented: “Brazil is one of the fastest growing economies in the world with arguably the most sophisticated capital markets of the BRIC countries. Its growth is being propelled by the commodities boom, enormous riches in natural resources, a stable political system and a labour force of 200 million plus people.”

He added: “While the credit crunch continues to affect economies and M&A the world over, Brazil remains one of the few markets with strong M&A growth. Deal volumes in the 12 months to June 2008 have doubled to more than 600 with their value exceeding $43 billion.”