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October 07, 2010

M&A activity increases 72% during the 9 months ended Sep 2010

During the nine months ended September 2010, Indian companies were involved in a total of 474 M&A deals, up 72% from the same period in 2009, according to a study by Venture Intelligence (http://www.ventureintelligence.in), a research service focused on Private Equity and M&A transaction activity in India.

The median deal value during the first nine months of 2010 (for the 206 deals which had announced transaction values) at $16 million was however down from the median deal value of $20 million for the same period in 2009, the Venture Intelligence study found. In the largest deal during the period, Reliance Natural Resources agreed to merge with Reliance Power in a deal valued at $11 billion. This was followed by Bharti Airtel’s $10.7 billion acquisition of Kuwaiti-based Zain's African assets; Vedanta Resources’ $8.5 billion bid to acquire oil & gas firm Cairn India and Mundra Port’s $5.48 billion amalgamation with Adani Enterprises.

About 30% of the deals in the nine months ended Sep ’10 were outbound acquisitions, as against only 26% for the same period in 2009. Domestic deals continued to be the major contributor with a 56% share.

The most preferred destination for Indian acquirers was USA with 41 of the 144 outbound targets in the nine months ended Sep’10 located in that country, followed by the UK (with 28 deals). The acquirers in nineteen of the 67 inbound deals were US-based companies, followed by French firms with nine deals and British firms with seven deals.

The IT & ITES and Manufacturing industries accounted for majority of acquisitions during the nine months ended Sep ’10 with a 21% share each. The activity in the Manufacturing industry grew from 19% during the same period last year while the share of IT & ITES deals fell marginally (from 23%).

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Venture Intelligence, a division of Chennai, India-based TSJ Media Pvt. Ltd., is the leading source of information on private equity and M&A transactions in India. For more information, please visit http://www.ventureintelligence.in