Finalyst November 2013 Issue November 2013 | Page 21

FINALYST

NOVEMBER 2013

How do you make money? Spinoffs, split-ups, liquidations, mergers and acquisitions.

The M&A scenario in India for the
first 10 months were subdued per
say and the average time for the deal
closures have increased. There were
a total 411 M&A deals till Oct 2013
which is less than 493 deals between
same period in 2012 and 518 in JanOct 2011.

The total outbound deals in the period has remains almost same but the
inbound deals has declined considerably. Inbound M&A plummeted
66.3% from Q2 2013 ($7.1 billion to
$2.4 billion in Q3). Concerns surrounding the outcome of next year’s
general elections as well as the drag
effect of Tax and Regulatory uncerMoreover there has been a signifitainties and the US Federal Reserves’
cant decline in terms of values of the
planned ‘tapering’ kept foreign acdeal. This year the total value of inquirers at bay
bound-outbound deals was $24.48
billion which is about 17% less than
But according to analyst the inbound
the value of $30.56 billion in 2012. In
sector is showing an upward trends
the year 2011 the figure stood at
and the number of deals is likely to
$38.01 billion.
go up in coming period. Relaxing of
In the interval Q3 2013 M&A in India FDI norm in the sectors like retail,
totalled $5.7 billion, a reduction of insurance, media and proposed M&A
28.75% from the previous quarter reforms in telecom sector will help in
value of $8 billion. The number of gaining momentum and it will soon
deals marked the first decline in show a upward trajectory.
quarterly deal count since Q2 2012.
Unilever’s $3.5 billion acquisition of

an additional 14.8% stake in Hindustan Unilever was the largest deal in
India so far this year and accounted
for 20.9% of aggregate M&A value in
the country. It
boosted the value
of deals in the Consumer sector
306.1% to $4 billion , making it the
most active sector for M&A in India
The Pharma, Medical & Biotech sector was the only sector to witness a
second successive uptick in M&A value. An aggregate $1.8 billion worth
of deals occurred in the sector during
Q1-Q3 2013, maximum since Q1-Q3
2010 (US$ 4.2bn, US$ 3.7bnof which
was accounted for by Abbott’s landmark
acquisition
of
Piramal
Healthcare)
Outbound bids totalled $2.8 billion in
Q3 2013, representing a 47.2% fall
from Q3 2013 (US$ 5.3bn). The Q1Q3 2013 figure ($8.7 billion) though,
exceeded Q1-Q3 2013 by 124%. This
arose from two acquisitions worth
$5.1 billion by state-run ONGC and
Oil India off the coast of Mozambique, moderating the impact of
ONGC’s failure to secure a $5 billion
stake in Kazakhstan’s Kashagan oil
field.
Apollo Tyres’ $2.3 billion bid for
Cooper Tire and Rubber may be
scrapped due to disputes with work21
ers in China and the US.