The art of the deal

A revival of inbound and outbound mergers and acquisitions is adding colour to India Inc

By George W Russell

India-related merger and acquisition deals totalled US$44.2 billion in the first three quarters of 2010, a 24.5% increase in volume terms over the corresponding period last year, according to data from the London-based Mergermarket Group, a data service that tracks worldwide M&A. VCEdge, a Noida-based venture capital tracking service, puts the total at closer to US$50 billion.

Colossal earnings

This year took off with a bang: In the first quarter, Indian firms invested US$12.6 billion in 44 mergers and acquisitions involving foreign targets, according to global business and financial consultancy Grant Thornton. The value of these deals was 75 times more than in the same period of the 2009, when 15 outbound deals with a total value of US$228 million were recorded.

Then in June, Bharti Airtel – India’s largest mobile phone operator by subscriber numbers – announced it had completed its US$9 billion acquisition of most of the overseas assets of Kuwaiti Mobile Telecommunications Co, known as Zain, covering 16 African countries. And 2010 has already seen the emergence of a number of other major deals, such as Essar Minerals Resources’ takeover of US-based Trinity Coal Corporation for US$600 million.