India’s Top 10 M&A Deals

Posted by Reading Time: < 1 minute

Mar. 3 – The all-share merger between Reliance Industries India's largest private sector firm with its subsidiary Reliance Petroleum which created the world's sixth-biggest refiner also marks the country’s 10th largest M&A deal ever.

While 2005-2008 saw large, M&A deals, the past few months have seen a significant plunge in M&A deals in India, even as valuations of Indian companies have become extremely attractive. So far 2009 saw M&A deals worth US$4 billion, less compared to 2008’s M&A deals worth US$30 billion.

Not only has M&A activity fallen, but deal values have also plummeted. During 2005-08, listed Indian companies have been involved in 54 M&A activities worth US$45 billion, but the current mark-to-market value of such M&A’s is down to US$20.96 billion, indicating a loss of 53 per cent, SMC Capital said in a report.

An unprecedented bull market and economic optimism in 2007-2008 caused many Indian companies to make brisk, aggressive deals leading to a fall in company valuations. A yearly comparison also shows that the listed M&A’s of 2005 have performed relatively better with a current mark-to-market return of negative 6.68 per cent. However, the listed M&As of 2006, 2007 and 2008 are bleeding severely with losses as high as 62.84 per cent, the report added.