Temasek and Votorantim Launch $700M Fund to Invest in Brazil

By Nick Hedley

Singapore’s state-owned investment firm Temasek and Brazilian family-owned investment group Votorantim have launched a $700 million fund aimed at capitalizing on investment opportunities in Brazil.

The new investment vehicle, called 23S Capital and headed by Temasek’s Matheus Villares, will provide growth funding to Brazilian companies, the investors said in a joint statement.

“Our investment mandate will focus on themes associated with secular trends taking place in Brazil and globally, with an emphasis on new business models and technology across various sectors of the Brazilian economy,” Villares said. “This strategy will position 23S Capital as a long-term partner to companies and entrepreneurs pursuing this journey.” 

Temasek CEO Dilhan Pillay said the partnership with Votorantim “is an evolutionary phase in our investment strategy and engagement in Brazil, representing a new and exciting way to explore investment opportunities in this geographically important market.”

Temasek, which has a net portfolio value of S$403 billion (US$294 billion), has been increasing its allocations to the Americas and to Europe, the Middle East and Africa, although around two-thirds of its assets are still in Asia.

“We will partner up with entrepreneurs and high-growth companies to support them in the long run to become champions in their sectors,” Votorantim CEO João Schmidt said.

In a separate statement, Fitch Ratings said the partnership would have no impact on Votorantim’s credit ratings as it would not meaningfully affect its liquidity position.

“Fitch recognizes that the partnership could open new investments avenues for the group in the future regarding ongoing investments beyond the announcement.

“Fitch believes Votorantim remains committed to fostering more stable business within its portfolio, which should help provide additional resilience to Votorantim's investment-grade ratings as it navigates different macroeconomic cycles.”