India Inc saw $4.6-bn M&A deals in Aug: Thornton

India Inc has announced deals worth $4.63 billion in the month of August, led by ONGC's acquisition of Imperial Energy Plc, which accounted for half of the total deal volume.

Global consultancy firm Grant Thornton said, "The total number of M&A Deals announced in the month of August 2008 stands at 31 with a total announced value of $4.63 billion and the most significant deal has been ONGC's acquisition of Imperial Energy Plc for $2.80 billion."

However, a year-on-year comparison shows that the deal volume has more than halved.

The total number of M&A deals during the first eight months of this year stood at 346, with an announced value of $22.74 billion as against 456 deals amounting to $48.23 billion in the corresponding period in 2007, according to the data compiled by Grant Thornton.

There was an increase in high-value deals in August. The most significant are ONGC's acquisition of Imperial Energy for $2.80 billion, followed by Infosys Technology's takeover of UK-based Axon for $0.81 billion and CBay systems' acquisition of MedQuist Inc for $0.28 billion.

Though there was a decline in the deal volume on a month-on-month basis, the deal value has increased considerably.

"The total number of M&A deals announced in the month of August stands at 31 with a total announced value of $4.63 billion as against 43 deals amounting to $0.58 billion in the month of July this year," Thornton added.

Cross-border deals continued to outnumber domestic deals in August.

While there were nine domestic deals, wherein both acquirers and target companies were Indian with an announced value of $0.08 billion, there were as many as 22 cross-border deals with an announced value of $4.55 billion in the period under review.

Out of the 22 cross-border deals, 17 were outbound ones, where Indian companies acquired businesses outside India, with a value of $4.48 billion, and five were inbound deals where international companies or their subsidiaries acquired Indian businesses with an announced value of $0.08 billion.

In the private equity space, both the deal value and volumes have witnessed a jump.

"The total number of private equity deals announced during August stands at 31 with an announced value of $944 million as against 29 deals amounting to $650 million in July," Thornton said, adding that with this, the total number of PE deals during the first eight months of 2008 stood at 246, with an announced value of $8.69 billion.

In the first eight months of 2007, 260 PE deals were announced amounting to $10.74 billion.

Some of the major PE deals in August include MPC Synergy's $325 million investment in Phoenix Mills, Baring Private Equity Asia's $100 million infusion in RSP Architects & Planners India, New Silk Route Advisors' $50 million investment in Dawnay Day AV Financial Services and Oman Investment Fund's $120 million infusion for 18.74 per cent stake in Quippo Telecom.