Mergers and acquisitions drop 41.5 percent in 9 monthsOctober 7th, 2011 - 7:44 pm ICT by IANS
New Delhi, Oct 7 (IANS) Mergers and acquisitions (M&A;) in India have slumped by 41.5 percent to $26.8 billion during the first nine months of 2011 as rising interest rates and uncertainties in the global economy dampened sentiments, a report showed Friday.
During the January-September 2011 period, 177 mergers and acquisitions deals, valued at $26.8 billion, took place which is 16.9 percent lower in volume and 41.5 percent lower in terms of value when compared to the same period in 2010, according to data compiled by mergermarket, an independent mergers and acquisitions intelligence firm.
“With India’s benchmark Sensex slumping almost 23 percent year to date, rising inflation and interest rates and ongoing global woes, it is not surprising that domestic mergers and acquisition dwindled in the January-September 2011 period as compared to the same period last year,” Anjali Naik, Deputy Editor of mergermarket, Asia Pacific, said in the report.
Inbound deals accounted for 88.1 percent of all Indian M&A; activity, four times that of Indian investments overseas. Inbound deals stood at $7.32 billion in July-September quarter as compared to $2.65 billion in the previous quarter.
The total deal value in the first nine months of 2011 was largely contributed by two inbound deals — British Petroleum’s $7.2 billion bid for Reliance Industries Limited and Vodafone Group’s purchase of 33 percent stake in Vodafone Essar for $5.46 billion.
Energy, mining and telecommunications sectors accounted for more that 50 percent of the M&A; deals in the country.
However, each of the sectors saw a sharp decline when compared to the corresponding period last year. Energy and mining stood at $7.83 billion, a fall of 35.6 percent, telecommunications sector saw a massive decline in both deal value and deal count, from 16 deals worth $19.56 billion in January-September 2010 to three deals worth $6.13 billion in January-September 2011 — a significant drop of 68.7 percent.
“While valuations and deal values might be muted, activity is expected to continue on a smaller scale in the industrials and chemicals, financial services and consumer sectors,” Naik said.
- Auto production hits record level in Mexico - Oct 18, 2011
- Foreign tourist arrivals up in September - Oct 10, 2011
- Abu Dhabi hosts industry meet - Dec 19, 2011
- Brazilian government sees economy expanding through 2014 - Feb 14, 2012
- Brazil announces plan to boost exports - Feb 18, 2012
- August exports decline by 9.7 percent - Sep 13, 2012
- Indian economy hit by high inflation, slowing growth (2011 in Retrospect) - Dec 28, 2011
- India's exports slump 14.8 percent in July - Sep 03, 2012
- Vodafone Group's quarterly India revenue grows 6.3 percent - Feb 09, 2012
- Bankers revise Brazil's growth outlook downward - Dec 27, 2011
- Major Chinese industrial companies' profits drop - Mar 27, 2012
- China's foreign trade to top $3 trillion this year: Official - Oct 28, 2011
- 'Mergers, acquisitions in telecom lucrative despite slowdown' - Dec 24, 2008
- South Korea's current account surplus contracts - Jan 30, 2012
- India's exports rose 6.71 percent to $25 bn in December - Feb 01, 2012
Tags: 9 months, asia pacific, british petroleum, deputy editor, first nine months, global economy, global woes, indian investments, massive decline, mergermarket, mergers and acquisition, mergers and acquisitions, oct 7, reliance industries, reliance industries limited, rising interest rates, sentiments, telecommunications sector, vodafone essar, vodafone group