total value of Indian mergers & acquisitions
including private equity deals in 2008 amounted
to US$41.54 billion, compared to US$70.14 billion
in 2007 and US$28.16 billion in 2006, according
to India Watch, the quarterly review by the leading
business and financial adviser Grant Thornton.
The UK has been the largest target country for
India's outbound M&A activity receiving a
total investment value in excess of US$6.6 billion.
"Despite a decline in
values between 2007 and 2008, the total value
of M&A deals including private equity deals
has increased by 47.5% since 2006, maintaining
the positive compound annual growth rate of M&A
and PE in India," says Anuj Chande, Head
of Grant Thornton's South Asia Group. "Further
to this, 2008 saw some landmark deals and also
witnessed more billion dollar M&A deals than
"In 2009, we see some
encouraging prospects for Indian companies, which
have generally remained cash rich," says
Chande, who points out that these may benefit
from a drop in valuation levels across the globe."
"I expect to see an
increase in takeovers of UK targets by Indian
companies when valuations drop further as the
recession bites in the UK," says Chande,
adding that Indian corporates were particularly
keen on acquiring well-known British brands.
The largest outbound deal
was Oil & Natural Gas Corp Videsh Ltd's acquisition
of UK-based Imperial Energy Plc for approximately
US$2.8 billion, followed by the Jaguar Land Rover
acquisition by Tata Motors of US$2.36 billion.
made up the lion's share in Indian M&A even
though their total value was 47% lower then in
2007," says Chande. In 2008, the total value
of inbound deals was US$12.55 billion, as international
companies acquired stakes in 86 Indian businesses.
That compares to US$15.50 billion in 2007 and
US$5.4 billion in 2006.
The largest of these was
the Japanese-based pharmaceutical company Daiichi
Sankyo's step acquisition of a 60.63% stake in
Indian-based pharmaceutical company Ranbaxy for
a total value of US$4.5 billion. Another notable
transaction was Japanese mobile operator NTT Docomo
Inc.'s acquisition of a 26% stake in Tata Teleservices
Ltd for US$2.70 billion.
Over the same period, the
total value of outbound deals reached US$13.19
billion, comprising 196 deals involving Indian
companies acquiring businesses outside India.