Mexico: Corporate/M&A: Highly Regarded Overview

Beyond the Balance Sheet: When Regulation Shapes the Deal

Mexico remains one of the most closely watched markets in the dealmaker hemisphere, and the numbers explain why. Foreign direct investment reached a record USD40.9 billion in 2025, up 10.8% on the figure originally reported for 2024, according to the Secretaría de Economía (comunicado 13, 25 February 2026), with the United States remaining Mexico’s largest source of capital. Reinvested earnings (profits that businesses already operating in Mexico plough back into their own operations) made up more than two thirds of that total. New investment grew sharply too, but it remained well below reinvested earnings, a sign of how much value is now generated by deepening existing positions rather than opening new ones.

The deal market reflects the same trend. TTR Data (2025 annual report) recorded 307 M&A transactions in Mexico in 2025; volume fell 17% on the year before, but disclosed deal value rose 86% to USD32.5 billion. Investors are doing fewer deals, for more money, in a market shaped by trade uncertainty with the United States and more selective capital allocation. A growing share of that capital is going into businesses that already exist, in one form or another – by acquiring an established platform, taking a partial stake in a project, or restructuring operations already on the ground – rather than into traditional market entry. For companies weighing whether to build, buy or partner their way into Mexico, the legal and regulatory implications are a fundamental component of the strategic analysis.

A regulatory environment in motion

That shift is sharpest in the sectors that are key for the country’s development: electricity and hydrocarbons. Mexico rebuilt its energy regulatory framework in 2025 through new sector laws and a new energy regulator, while in July of 2025, Congress approved the creation of a new National Antitrust Commission (Comisión Nacional Antimonopolio – CNA) to replace the Mexican Federal Economic Competition Commission (COFECE). The CNA, which took office in October 2025, is a single body that also absorbed competition functions previously handled separately for telecoms and broadcasting.

For companies buying into any of these sectors, this reorganisation implies a shift in the way transactions are addressed. It changes who reviews them, on what timetable, and what a deal must account for before it can close at all. It means that a business’s regulatory standing is now as much a part of its value as its revenue or its balance sheet. This new landscape requires lawyers to act as business partners rather than as legal custodians.

Buyers now face a different diligence exercise in which it is no longer enough to confirm what a company owns and how much cash it generates. Instead, the more relevant questions are now often how durable its licences are, how a change of ownership is treated under them, how quickly a newly reorganised regulator can be expected to act, and how political decisions may affect the regulatory framework of a given business. Sequencing matters just as much. Applications are filed before different authorities, each on its own timetable, and each approval remains valid only for a limited period in which the deal must close. Those windows vary by industry and by the applicable law, and they frequently shape the structure of an acquisition. Companies that can answer those questions early tend to move through the process with fewer surprises than those that treat them as a formality to clear once terms are agreed.

Electricity

Electricity is a clear example. Developers and investors in Mexico’s private electricity market have increasingly turned to special-purpose vehicles to hold the land rights, interconnection agreements and permits that let a generation or transmission project connect to and sell into the grid, built specifically to be bankable for project financing and kept separate from the sponsor’s broader business.

Selling that vehicle cleanly, with title, permits and easements intact, is frequently what determines whether a buyer’s own financing and construction timetable can proceed on schedule. The corporate transaction and the project’s financeability are, in effect, the same exercise, and treating them separately is one of the more common ways these deals lose time between signing and closing.

Hydrocarbons: upstream to downstream

The hydrocarbons sector shows the same pattern across its life cycle, from exploration to the retail pump – and the transaction realities at each point in the chain look nothing alike.

At the upstream end, the largest Mexican conglomerates have shown consistent interest in oil and gas exploration and production, either by taking ownership interests in blocks licensed by the former Comisión Nacional de Hidrocarburos (CNH), or through mixed projects with Pemex, Mexico’s state-owned oil and gas company, under the new framework. Completing a change of control over blocks licensed under the previous regime requires both sector approval and merger-control clearance. Where those processes run for months, sellers and buyers must actively manage licence performance, capital commitments and shareholder alignment for as long as the deal stays open, not only up to signing.

Midstream tells a related story. Elintra’s acquisition of Gasline, a natural-gas distribution platform, was not simply a purchase of pipelines and equipment. On the contrary, the business’s value sat as much in its permits, its customer contracts and its standing with the system operator as in its physical assets. Diligence in that kind of transaction must establish not just what the target owns, but whether its permits, contracts and compliance history will keep supporting the same revenue once ownership changes.

At the downstream end, the 2026 sale of Shell’s Mexican retail-fuel and commercial-fuel business to the Mexican operator ICONN was more than a change of ownership at hundreds of fuel stations. Sector permits are personal to their holder: under the Hydrocarbons Sector Law, both an assignment and a change of control require authorisation from the Comisión Nacional de Energía (CNE). Rather than assign the permit, the deal changed control of the holding entity, with CNE reviewing that change afterward, not beforehand. Alongside it sits a separate trademark licence – the Shell name belongs to Shell’s global brand owner, not the Mexican entity acquired – and a supply agreement keeps Shell providing the fuel imported under it: ICONN takes over the stations, the commercial fuel platform and operations as owner, continuing to trade under the Shell name and premium-fuel standard..

Three different points on the same value chain, three different transaction structures: a change-of-control sale under a shifting competition regime; a platform acquisition built on permits and contracts; and a licence-and-brand transfer at retail scale. What they share is this: what is being bought is a functioning, highly regulated business, not just a set of assets or shares.

An investment market that remains open

None of this makes it more difficult to invest in Mexico. The underlying demand for energy, fuel and infrastructure is not going away, and neither is investor interest in helping to meet it, even against a backdrop of trade uncertainty and institutions still settling into their new form. It does mean that the strongest offers, and the smoothest closings, go to businesses that keep running the same way after the deal as before it. This is what continues to make Mexico, across sectors that are anything but simple to operate in, an unusually attractive market – and one worth understanding in detail before capital is committed.