Financial crisis hits global merger and acquisition deals

October 26th, 2008 - 3:36 pm ICT by IANS  

New Delhi, Oct 26 (IANS) Outbound merger and acquisition (M&A) deals have been hit by the global financial crisis, losing their valuation by 76 percent this year, according to an industry lobby study. The report, released by the Associated Chambers of Commerce and Industry of India (Assocham), said 72 M&As worth $3.73 billion took place in the April-August period this year as against 54 deals worth $15.5 billion in the same period last year.

Despite the global slowdown, altogether 18 outbound M&As took place in the IT sector, followed by 11 in pharmaceutical, nine in telecom and two in power.

In terms of valuation, the pharmaceutical sector topped the list at $5.25 billion with 38.69 percent of the total valuation of M&A deals. The telecom sector accounted for 17.41 percent, while the IT and power sectors accounted for 15 percent and 8.44 percent respectively.

The major inbound M&A deal in the pharmaceutical sector was Japan’s Daiichi Sankyo acquiring 51 percent stake of Indian pharma giant Ranbaxy Laboratories for $4.6 billion.

Other sectors such as metal and mining, auto, banking and finance, chemical, petrochemical, construction, engineering, healthcare, manufacturing, media, real estate and textile witnessed 75 M&A deals worth $3.64 billion, accounting for a 20.46 percent share.

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