Merger and acquisition (M&A) deal in Brazil may take slower than expected, thanks to tougher regulation as an effort to push transparency. Some important deals have been stuck as trade groups have been increasing pressure on industry supervisory bodies and government auditors to halt state asset sales to cut the country's debt. As a result, many big companies asked antitrust bodies to review what rival industries are doing, postponing a number of deals.

One of the affected companies is Brazil's well-known oil company Petrobras ( Petroleo Brasileiro SA Petrobras). In December, the federal court decided to call off asset sale, causing the oil giant to skip two-year goal of obtaining $15.1 billion by the end of last year worth more than $1 billion, as Reuters reported.

According to Thomson Reuters data,  there are around 14 takeovers worth more than $8 billion that were supposed to be carried out last year but had been left for 2017, because buyers have been more wary of facing legal implications in Latin America's biggest economy.

Besides Petrobras' asset sale, Odebrecht's exit from a Peru gas pipeline project is also one of the deals that got stuck in 2016.

According to Flávio Valadão, head of M&A at Banco Santander Brasil SA, which ranked first in Thomson Reuters' 2016 Brazil's advisory ranking, the worst recession, and ongoing corruption scandal investigation have put M&A activities on hold.

Massive corruption scandal resulted in the impeachment of Brazil's former president Dilma Rousseff on August 31, 2016. The impeachment divided the country so far, BBC stated.

State-run Petrobras is not only facing the low crude oil price, but also the effect of corruption scandal investigation. The company had to spend lots of money in the lawsuit targeting its top executives charged with inflating the contract values, forcing the giant to cut its capital expenditure and halt its exploration and production (E&P) activities.