Mergers and acquisitions in Latin America and the Caribbean plunged 50% by deal value to $8.7 billion in the first three months of the year as political unrest in the Andes suppressed investor appetite just as the new coronavirus emerged in China.

Mergermarket's first quarter 2020 M&A report highlights especially thin activity in Brazil and Colombia, which saw their slowest kickoff since the 2009 financial crisis.

All told, the tracking includes 113 transactions worth more than $5 million each in Latin America and the Caribbean during the quarter, down from 158 deals worth a combined $17.3 billion in the same three months of 2019.

Debevoise & Plimpton led the deal rankings by value, advising on two deals worth $2.3 billion combined. Brazilian firm Pinheiro Neto Advogados advised on the most deals in the region, consulting on 14 transactions worth a total of $686 million during the quarter.

The biggest deal by value in the region was announced in February: a $2.2 billion real estate acquisition by Austin, Texas-based Amherst Holdings LLC in the U.S. Virgin Islands. Gibson, Dunn & Crutcher advised Amherst.

Weil, Gotshal & Manges advised the seller, U.S. Virgin Islands-based Front Yard Residential Corp.

The next-biggest deal by value was the March $825 million purchase of Takeda Pharmaceutical Co. Ltd.'s noncore business in Latin America by Hypera SA, Brazil's largest pharmaceutical company with a leading position in branded prescriptions, consumer health and branded generics.

White & Case advised Takeda on the sale, which was the Japanese pharmaceutical firm's fifth divestment over 12 months as it seeks to reduce debt. Cescon, Barrieu, Flesch & Barreto Advogados in São Paulo advised Hypera.

The portfolio includes over-the-counter and prescription pharmaceutical products sold in Brazil, Mexico, Argentina, Colombia, Ecuador, Panama and Peru.

Private equity activity had enjoyed a rather robust start to the year, Mergermarket says, leading to stable global buyout deal value of $120.5 billion for the first quarter.

Then came the coronavirus.

Market volatility due to COVID-19 has temporarily shut down the primary market for leveraged loans, according to Mergermarket. The number of buyouts has dramatically decreased in the past month, and the firm predicts that private equity's ability to deploy capital will be further tested in the quarters to come.

Historically, M&A in Latin America has been somewhat protected from downward global trends, says Viviana Balan, Mergermarket's research relationship manager for the Americas.

This time appears different, she says.

"As the coronavirus spreads, the region could see further declines in M&A activity in the months ahead," says Balan.

Top M&A lawyers at global firms who work in Latin America say that although well-advanced deals closed during the first quarter, many investors have put the hunt for additional assets on ice.

Still, they say, some deep-pocketed clients are already prowling for bargains or strategic purchases in the region.