During the first quarter of 2009 Indian companies were involved in a total of 54 M&A deals, compared with 135 deals during the same quarter in 2008 and 89 deals the previous quarter
During the first quarter of 2009 Indian companies were involved in a total of 54 M&A deals, compared with 135 deals during the same quarter in 2008 and 89 deals the previous quarter, according to a study by Venture Intelligence.
Q1 2009 witnessed 26 deals with an announced value of USD4.6bn, the Venture Intelligence study reveals. There were 15 inbound and outbound deals each, with the rest being domestic acquisitions. Manufacturing was the most active industry with ten deals followed by IT & ITES with seven deals. Healthcare and life sciences, food and beverages, telecom and agri-business were the other industries that witnessed significant M&A activity in Q1 2009.
The largest inbound deal saw France-based stationery manufacturer BIC acquiring a 40 per cent stake in Mumbai-based stationery products maker Cello Pens for about USD160m.
Other notable inbound deals included American Tower Corporation acquiring the XCEL Telecom, Mylan Labs acquiring a residual stake in Matrix Laboratories and Sodexo’s acquisition of Radhakrishna Hospitality Services Group.
‘The Radhakrishna Hospitality and Cello Pens deals seem to validate the thesis that 2009 is likely to witness significant inbound transactions by MNCs with strong balance sheets seeking to acquire Indian companies when valuations are attractive,’ says Arun Natarajan, chief executive of Venture Intelligence (pictured).
Q1 2009 also saw Indian companies aiming to close out on their acquisitions of global energy/commodities assets. Notable deals in this category included ONGC Videsh’s closing out on the acquisition of UK-based Imperial Energy for USD1.9bn and Sterlite Industries’ new bid for US-based copper mining firm Asarco at a renegotiated value of USD1.7bn.
The largest domestic M&A deal during the period was Reliance Industries’ acquisition of group company Reliance Petroleum. In other domestic deals, private equity-backed Nuzhiveedu Seeds acquired a 51 per cent stake in two seed companies during the period – Yaaganti Seeds and Pravardhan Seeds.
