Compass debuted on B3 today, breaking a five-year IPO drought in Brazil. The offering raised R$3.2 billion at a R$20 billion valuation. It priced at the bottom of its range. That last detail tells you more than the first two.
The drought, by the numbers
Brazil’s B3 exchange hosted 45 IPOs in 2021. Then, effectively, zero. The last traditional B3 listing before today was Vittia Fertilizantes in September 2021. Nubank chose the NYSE for its landmark USD 2.6 billion debut that December, listing BDRs on B3 as a secondary gesture before delisting them entirely in 2022. From October 2021 through last Friday, the longest IPO drought in more than four decades.
Mexico’s story is quieter but structurally worse. The BMV attracted two new equity issuers in 2021, one in 2022, one in 2023, and essentially nothing in 2024. Meanwhile, the delisting parade continued: Sanborns, Santander Mexico, Monex, Rassini, Lala, Bachoco, GMXT, IEnova, Elementia, Farmacias Benavides. The BMV now has 131 listed companies, and 74% of them are classified as low-liquidity by the exchange’s own metrics. When three-quarters of your listed universe barely trades, the exchange has a structural problem that no single IPO can fix.
Against this backdrop, Fibra Next’s USD 431 million BMV listing in July 2025, the largest Mexican IPO in seven years, was presented as a turning point. Aeromexico’s USD 275 million offering four months later was framed as confirmation. But Aeromexico listed on the NYSE, not the BMV. And Fibra Next is a FIBRA, a tax-advantaged trust structure, not a traditional equity listing. The turning point, on closer inspection, turned away from home.
(Sep 2021 to May 2026)
as low-liquidity by exchange metrics
Compass breaks the dam, barely
Compass Gas e Energia, the gas-and-energy arm of Cosan, began trading today on B3 under ticker PASS3. The company owns Comgas, Brazil’s largest natural gas distributor, plus the Commit federation of state distributors and the Edge marketing brand. The offering was wholly secondary: Cosan and other shareholders sold 89.3 million shares at R$28 each, the bottom of the indicative range. At that price, Compass is valued at approximately R$20 billion (USD 4.1 billion).
The bottom-of-range pricing is the detail that matters. Compass is not a speculative startup. It is a regulated gas utility with predictable cash flows, backed by Cosan, one of Brazil’s most respected conglomerates. If this company, in this sector, with this sponsor, could only price at the floor, it tells you something about investor willingness to commit capital to Brazilian equities at current conditions. The Selic at 14.50% offers fixed-income returns that make equity risk premiums difficult to justify. The market opened, but it opened with a concession.
Bradesco BBI has mapped a pipeline of approximately 10 equity offerings on B3 for 2026, combining IPOs and follow-ons, with estimated combined volume of R$15 billion. BRK Ambiental, the water and sanitation company backed by Brookfield, had been positioned to break the drought first but delayed its USD 750 million offering earlier this year when market conditions deteriorated. Aegea, another sanitation player, and Copasa are in the queue. Over 100 Brazilian companies are reportedly IPO-ready, waiting for the window.
But the window is narrow. The Selic is still 14.50%. Inflation expectations are rising for seven consecutive weeks. The fiscal deficit has reached 8.5% of GDP. And the October elections loom. Compass got through. Whether BRK Ambiental and the rest can follow depends on whether the Selic trajectory bends downward and whether the fiscal picture stabilizes. Neither is guaranteed.
The New York migration
While B3 waited five years for Compass, Brazilian companies were listing elsewhere. The migration to U.S. exchanges accelerated in early 2026, and the pattern is striking.
PicPay, the digital payments platform, listed in the U.S. in January 2026, raising USD 434 million at a USD 2.5 billion valuation. Agibank, the digital bank focused on Brazil’s lower-income consumers, followed in February on the NYSE, raising USD 240 million at a USD 1.92 billion valuation, after scaling back its offering when PicPay shares dropped 20% post-listing. And the biggest deal in the pipeline is not coming to B3 at all: Elo, the domestic card network controlled by Bradesco, Banco do Brasil, and Caixa Economica Federal, has hired Morgan Stanley, Goldman Sachs, and JPMorgan for a Nasdaq IPO targeting a USD 7 billion valuation in the second half of 2026.
Consider what Elo’s decision means. This is Brazil’s domestic payments network, owned by Brazil’s biggest banks, processing transactions in Brazilian reais. And it is choosing Nasdaq over B3. If BDRs are listed on B3, they will be a secondary accommodation, just as Nubank’s were before they were withdrawn. The message is clear: for growth-oriented companies seeking global institutional capital, the Brazilian exchange is not competitive.
Mexico’s pattern is the same. Aeromexico chose the NYSE for its November 2025 re-listing, raising USD 275 million and closing its first day up 7.1% at USD 20.35. The company had previously been listed on the BMV before its 2020 bankruptcy and Chapter 11 restructuring. When it came back to public markets, it chose New York. Banamex, which will be the most consequential Mexican financial listing in years, is now targeting early 2027 after repeated delays. Citigroup has already sold 49% of the bank through private placements (25% to Fernando Chico Pardo at 0.80x book, 24% to institutional buyers at 0.85x book). When the IPO eventually happens, the listing venue has not been confirmed, but the private placement pricing, at discounts to book value, suggests the market is not assigning a premium for Mexican exchange access.
What the listing decisions reveal
The bifurcation is not random. It follows a clear logic: infrastructure, real estate, and regulated utilities list locally. Technology, fintech, and growth companies list in New York.
In Brazil, Compass (gas utility) listed on B3. BRK Ambiental (water/sanitation) is targeting B3. Copasa (sanitation) would be B3. These are regulated, asset-heavy businesses whose investors are primarily domestic pension funds and local institutional accounts that need BRL-denominated exposure. The B3 works for them because the investor base is local and the business is local.
But PicPay, Agibank, and Elo chose the U.S. because their growth stories require global capital and global comparables. A Brazilian fintech valued at 15x revenue needs investors who understand the SaaS or payments framework, investors who sit in New York, Boston, and San Francisco. The B3’s institutional base, dominated by fixed-income-heavy pension funds and insurance companies, is not structured to support these valuations.
In Mexico, the pattern holds. Fibra Next listed on the BMV because FIBRAs are tax-advantaged vehicles designed for domestic investors, primarily AFOREs (pension funds) and insurance companies. GAP just announced a FIBRA E process for its airport infrastructure. These are local capital market products for local capital. But Aeromexico, competing globally for airline investors, went to New York. And Banamex will ultimately need to attract international capital to achieve a fair valuation for Citigroup’s exit.
The implication for investors is structural. The BMV and B3 are not dying, but they are becoming specialized domestic venues for asset-heavy, regulated businesses. The growth economy, the companies that drive earnings revisions and multiple expansion, is listing in the United States. This means the IPC and Ibovespa are becoming less representative of their economies over time. Mexico’s GDP is driven increasingly by nearshoring, technology services, and digital commerce. The IPC’s composition, heavy on telecoms, consumer staples, and mining, reflects the economy of 2015, not 2026.
home exchanges (B3 + BMV)
U.S. exchanges (NYSE + Nasdaq)
The reform question
Both countries are aware of the problem. Mexico’s stock market reform, passed in 2023 and approved by the CNBV in 2024, aims to ease listing requirements and reduce costs, potentially qualifying up to 4,000 additional companies for public listing. The BMV adopted T+1 settlement in 2024, aligning with U.S. and Canadian standards and reducing guarantee requirements by 32%. These are meaningful changes. But they address friction, not the underlying incentive structure.
The fundamental problem is not that listing in Mexico or Brazil is too difficult. It is that listing in New York is too attractive. U.S. exchanges offer deeper liquidity, higher valuations, a broader analyst base, inclusion in global indices (which drives passive flows), and a legal framework that international investors trust. Until the BMV and B3 can offer comparable liquidity depth and valuation multiples, growth companies will continue to choose New York. No regulatory reform can close that gap on its own.
Brazil has one structural advantage Mexico lacks: scale. The B3 handles roughly USD 4 billion in daily equity turnover, enough to absorb a USD 650 million Compass offering. The BMV’s daily turnover is a fraction of that. If Banamex eventually lists on the BMV, it would be transformational for liquidity: a major bank with broad retail ownership could meaningfully change the exchange’s trading dynamics. But that listing is at least a year away and not confirmed for the BMV.
The bottom line
Compass broke Brazil’s five-year IPO drought today, and the pipeline behind it is real: R$15 billion in planned offerings, 100+ companies waiting, sanitation and energy names positioning for B3 listings. But the deal priced at the bottom of its range, and the largest Latin American IPOs of 2026 are all heading to New York: Elo at USD 7 billion on Nasdaq, PicPay and Agibank already listed on U.S. exchanges, Aeromexico on the NYSE.
Latin America’s capital markets are reopening. The question is which capital markets. The local exchanges are becoming infrastructure and utility venues. The growth economy is listing in the United States. For investors in the IPC and Ibovespa, this migration means the indices they own are increasingly concentrated in asset-heavy, low-growth sectors while the companies driving economic transformation trade under tickers on the NYSE and Nasdaq.
We are watching the Banamex timeline closely. If it lists on the BMV, it would be the most significant Mexican listing in a generation and could shift the structural dynamics we describe here. If it lists in New York, as Aeromexico did, it would confirm them.