India looks attractive despite global M&A fall: Accenture

July 21 - MoneyControl.com - According to a study by Accenture Ireland, the M&A activity has fallen off significantly. But India has managed to sail through despite the global fall. CNBC-TV18's Shreen Bhan spoke exclusively to corporate honchos from India Inc and from Accenture.

According to Peter Smyth, Lead, Accenture Ireland, there has been quite a significant fall off in the level of merger and acquistion activity. The Q1 stats for 2008 have seen a 24% drop in the value of M&A Activity, he said."We saw a fall in March 2008 of 40%, so the trend is getting much steeper," Smyth said. Read More.

Private equity pours into Indian media sector

July 4 - TelevisionPoint.com (India) - Do you know that 55% stake in INX Media is held by Temasek Holdings, New Silk Route Partners, New Vernon Private Equity Fund and Employee sweat equity.

Do you also know that the shareholding pattern of NDTV Networks includes Lehman Brothers, Goldman Sachs, CSFB and eight others, who jointly hold as much as 24% stake in it.

The Indian Media and Entertainment sector has never been a hot cake among PE investors. But of PE firms are showing great interest in the sector. Blackstone's 26% stake in Ushodaya Enterprise for $ 146 million, Chrys Capital's 27% stake in Hathway cable for $ 120 million, Shyam Equities' 20% stake in Independent News Service, holding company of India TV for $ 25 million are few examples. Read More.

Indian firms are mature to handle M&As now

June 29 - The Economic Times (India) - It’s raining deals for India Inc. Put aside the global recession, Indian companies are not only looking to tap opportunities offshore but are also being seen as a lucrative asset by foreign companies. The emerging-market M&A activity in 2008 so far is up 17% over last year at this time, at $218 billion, while for the rest of the world it is down 43%, at $991 billion. But all is not well, feels Abhey Yograj, chairman and MD, Tecnova. In the last two decades, his company has helped over 280 global organisations make their Indian foray by providing cross-border acquisitions, workable strategy solutions and implementation assistance. He explains the challenges ahead in the M&A segment. Read More.

Private equity Asia – the market today

June 23 - FinanceAsia.com - Asia has been an area of focus for a number of global and local private equity players for many years. The credit crunch has prompted an even larger number of financial sponsors from the US and Europe, and the advisers who look to work with them, to ramp up their Asian presence and make it a key market for their business. Of course, simply increasing presence and capital available in Asia will not be enough for private equity players to succeed in the region.

Asia continues to present some formidable challenges to private equity investment. While these vary from country to country, generally speaking they include a combination of cultural, commercial and regulatory factors that get in the way of successfully investing and successfully exiting in a time honoured fashion. In many markets, and in particular in the two markets which dominate Asian investing - China and India - this means that even the basic LBO deal model that has served private equity so well in the US and Europe often cannot be used. Having said that, certain innovative (and highly structured) solutions have been developed to overcome this issue in India. Read More.

Analytics to see rise in M&A activities

June 16 - Business Standard (India) - Market research and analytics, a relatively new entrant into the knowledge process outsourcing industry, is expected to witness a spate of mergers and acquisitions in the coming days.

The M&A activity in the area will see companies acquiring small and niche players in the US and Europe to improve their front-end capabilities and consolidation in the domestic market, largely dominated by over 110 small-size companies in the revenue bracket of $2-$10 million. Read More.

India's Global M&A Boom

Indian corporations, established at home and seeking new markets, are flush with cash and spending it abroad. But have they gone overboard?

Bharti Airtel, India's largest telecom player, is in the midst of talks to acquire a 51% stake in South African telecom major MTN in a deal that could be worth $20 billion. It's unclear whether Bharti's bid will succeed, but plenty of other Indian companies have been on a global shopping spree. On May 1, Essar Steel Holdings announced its third overseas acquisition in a year—the Nasdaq-listed Esmark for $1.1 billion. In March, Tata Motors acquired Jaguar and Land Rover from Ford. And investment bankers say there are 10 more acquisitions by Indian companies in the pipeline over the next six months. Read More.

India comes of age in M&A, but not always smooth

May 9 - Reuters - Bharti Airtel's overtures towards South African telco MTN Group, which could lead to India's biggest foreign takeover, are a sign that big Indian firms are hungry for deals and undaunted by a global credit crisis that has dented M&A activity around the world.

While Bharti shares have been hit as analysts query the mobile firm's ability to fund a deal that could top $20 billion, few doubt there will be more acquisitions by increasingly outward-looking Indian firms.

"Indian corporates have come of age," said Pramit Jhaveri, head of investment banking at Citi India, which advised Tata Motors on its $2.3 billion buy of Ford Motor's Jaguar and Land Rover brands in March. Read More.

Cement industry to witness dip in M&A valuation

May 5 - The Financial Express (India) - India's cement industry, that is currently undergoing a consolidation and market leadership phase, will now witness a fall in the valuations of M&A deals. With cash flows at an all time high and capacity utilisation bursting at the seams, the cement industry, that has witnessed transactions happening at higher valuations, will now see a dip of 15% to 20% in M&A valuations going forward, say experts.

Says Sourav Mallik, associate director- investment banking at Kotak, "The cement industry is witnessing a fall in earnings and valuations. More M&As in the sector will now be driven by a strategic desire to exit rather than a financial compulsion to restructure." Read More.

Global M&As cross $1 tn in '08; India share just 1 pc

April 20 - The Economic Times (India) - The ongoing crisis in global financial crisis notwithstanding, the value of merger and acquisition deals announced across the world has crossed $1 trillion mark since the beginning of this year.

However, India's share in this global tally is just about 1 per cent, or about $10 billion. This is less than half of about 2.5 per cent share in the comparable period of 2007.

While the value of year-to-date global deals has declined by 27 per cent from the comparable period of 2007, that for deals involving India Inc has dropped by 71.5 per cent. Read More.

US opposes M&A rules

March 31 - The Times of India (New Delhi) - The US has asked India to remove the problematic rule in its new competition law that requires foreign companies to obtain government approval for mergers and acquisitions, including those taking place outside the country. In a report submitted to the Congress, the US trade department has said it has taken up the issue with the Indian government to change the new regulation governing M&As under the amended Competition Act.

"The United States is working with industry, foreign governments, and Indian companies and industry groups to persuade the government to promulgate regulations under the new law to correct the most problematic aspects of the M&A provisions," the national trade estimate report 2008 has said. Read More.

Cross-border M&As since 2002 to attract cap gains tax

March 1 - The Economic Times (India) - On the face of it, nothing seems to have changed for India Inc. Buoyant tax revenues and better compliance haven’t influenced the finance minister enough to prune the corporate tax rate, or even the surcharge. But, for overseas firms, acquiring companies in India just got costlier.

The FM may not have spelled it out in his speech, but the Budget fine-print reveals that the government has opened the doors for taxing cross-border deals. And that too with retrospective effect from June 2002.

The onus of paying capital gains tax on an acquisition in India will now rest with the buyer. The buyer is expected to deduct tax at source and failure to do so would leave him liable to pay the tax. Read More.

PE deals outnumber M&A transactions in Jan 2008: Study

February 25 - The Financial Express - Private equity placements are finding favour with India Inc with the number of such transactions surpassing that of merger and acquisition deals in the first month of this year.

Indian Companies announced as many as 60 private equity deals as against 56 M&A transactions, according to the data compiled by global consultancy firm Grant Thornton. However, the total value of PE deals was lower at 2.05 billion dollars compared to 3.01 billion dollars in M&As transactions. Read More.

India’s first private equity fair

January 9 - Gujarat Global - A Mumbai based company has come up with a novel idea to help mid-size companies get private equity fund. The company Yen Expo is going to hold a fair in Mumbai on February 27 which will provide a B2B platform to over 25 companies to show case their business and growth plans to 150 private equity funds from India and abroad.

The CEO of the company Arun Chandrachud said that it would be win win situation for both companies and the funds. Yen would charge industry a flat fee for the services it would offer. To help companies become Investment Ready, Yen has tied up with the Indian Institute of Management, Ahmedabad. For the fair, Yen has decided to shortlist 25 companies with the help of IIM A. Read More.

India: M&A wave likely to continue in '08

January 1 - The Economic Times (India) - There are some things that get bigger and better with time. While the ‘better’ part may be debatable, bigger is certainly the case when it comes to mergers and acquisitions. As the new year rings in, experts are betting on another great year for India Inc in 2008.

Investment banking circles predict that sectors like IT, telecom, financial services and infrastructure will be in the midst of M&A activity in the current year. Even as sectors like retail and insurance are coming into their own, bankers feel that one can wait for more clarity in guidelines before taking a call. Read More.

Global deals to drive record M&A activity from Asia

December 11 - Reuters - Asian companies and government funds are set to keep up their global buying spree in 2008, powered by a sagging dollar, cheap targets in the financial sector and strong balance sheets.

India and China's hunger for foreign assets and a frenzy of activity in the booming commodities sector triggered record merger and acquisition volumes in Asia outside Japan in 2007, with outbound acquisitions on track to triple last year's total.

That momentum is poised to continue as Asian buyers using swelling foreign exchange reserves look for natural resources, brands, distribution and know-how. Banks and government funds, meanwhile, are stepping in to bail out Western financial institutions reeling from the subprime mortgage crisis. Read More.

Asia's private equity investors opt for China and India: survey

December 10 - M&C.com - Private equity investors in Asia regard China as the market of choice followed by India, a KPMG survey said on Monday.

Sixty-one per cent of the respondents to this year's survey of 119 private equity firms said they have assets in China while 37 per cent have assets in India.

Third were Australia and Singapore, with 29 per cent, Taiwan with 28 per cent and Japan with 21 per cent. Read More.

India M&A push undeterred by credit woes

December 6 - Reuters - Armed with strong balance sheets, willing local lenders and unrelenting ambition, Indian companies are well positioned to navigate the credit crunch and maintain their global buying spree, but must be flexible on financing.

Turmoil in credit markets could even serve to open up opportunities for cash-rich Indian corporates looking globally to buy access to materials, technology, and distribution.

"Appetite continues to be there and continues to grow," Chanda Kochhar, joint managing director of ICICI Bank, India's No. 2 lender, told the Reuters India Investment Summit. "The Indian corporate sector has a healthy balance sheet strength to be able to execute some of these large transactions." Read More.

India the New Hot Spot for Global Private Equity

November 3 - The India Street - Thanks to increasing consumer market and economic boom in India, the action in private equity space is increasing with every passing day. Therefore, I was not at all surprised when one of my colleagues said to me that private equity funds are queuing up to enter India (By the way, another source for private equity news that we subscribe to is the VC Circle).

Point to be noted here is that Blackstone India and Apax Partners, which started investing in India this year, already have full-fledged offices here. Same is the case with Baird Private Equity and Lehman Brothers. What’s more, Deloitte Touche Tohmatsu India has also set up a dedicated private equity practice called Deloitte Corporate Finance Services India. Read More.

DEALTALK - Cross-border mergers defy U.S. slump

October 18 - Reuters - Even as tight credit conditions curb the urge among U.S. dealmakers to go shopping, the international mergers and acquisitions market is setting records.

Multinational corporations have been expanding into emerging markets, while foreign companies are using stronger currencies to pursue acquisitions -- especially in the United States.

So far this year, cross-border deals have reached a record high of $1.47 trillion, up 82 percent from the same period in 2006, according to research firm Dealogic.

"The value of the dollar, and the credit situation, are going to have less impact on these types of deals," said Mike Rogers, a partner in Ernst & Young's transaction advisory services group in Dallas. Read More.

Mid-sized companies step up cross border M&As: survey

The key drivers are need for geographic diversification, availability of good targets and access to financing, says the ACG/Grant Thornton/Eureka Private Equity survey

The increasing participation of middle-market dealmakers in global cross-border M&As is a new trend that is developing very quickly, says the findings of the ACG/Grant Thornton/Eureka Private Equity survey. This trend is fast catching up in USA, European and Asia, and is expected to further accelerate in the times to come, the survey says.

Cross-border M&A is now a vital part of strategic plans for middle-market companies and private equity firms, according to the survey. The key drivers in this respect are largely influenced by the need for geographic diversification, availability of good acquisition targets and access to financing, it says. Read More.