Boosted by government privatizations, mergers and acquisitions in Latin America soared to a record $81 billion last year as bigger and bigger transactions came onto the market, according to J.P. Morgan & Co.

"The year 1998 was clearly one for blockbuster transactions," a report from Morgan says. The company noted that 15 of the deals exceeded $1 billion, accounting for more than $35 billion of the total.

Morgan itself took the lead position in Latin American dealmaking for the fourth straight year, according to rankings compiled by Securities Data Co., an affiliate of American Banker.

Its share of the market for private transactions was nearly 18.5%. The company advised on 31 deals valued at nearly $7 billion, according to Securities Data.

That was well below the $10 billion worth of deals on which it advised in 1997 but above its totals of $4 billion in 1996 and $3 billion in 1995.

Salomon Smith Barney, a unit of Citigroup, was ranked second, with $2.7 billion worth of transactions.

Lehman Brothers was third, with $2.5 billion; Merrill Lynch & Co. fourth, with $2.3 billion; and Credit Suisse First Boston fifth, with $2.1 billion.

Other U.S. banks among the top 25 were Chase Manhattan Corp., seventh with nearly $1.9 billion, and BT Alex. Brown, which ranked 14th at $703 million.

The report from Morgan predicted that this year's volume is unlikely to match that of 1998 because of financial instability in Brazil.

"Many international acquirers are becoming more cautious about investing in the region," Morgan said. "At the same time, local sellers are very slow at adjusting their price expectations in response to higher perceived risk of investing in the region."

Privatizations, as well as larger transactions, accounted for most of the increase in Latin mergers last year.

Notable privatizations included the sale of Brazil's government-owned telecommunications company for $19 billion, the Argentine government's sale of its airports for $5 billion, and the Brazilian state of Sao Paulo's sale of its electricity distribution company to Enron for $1.3 billion.

Nearly 60% of all Latin American deals occurred in Brazil; 14% were in Argentina; and 10.5% in Mexico.

Acquisitions or mergers involving high-tech and media accounted for 36% of the total, energy/power (17%), basic industries (17%), and financial institutions (16%).

Excluding privatizations, the total value of transactions came to $36 billion, slightly below the $38.7 billion worth of such deals in 1997 but still well above the $22 billion in 1996 and $10.5 billion in 1995.

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