India Inc's M&A deal tally at $42 bn

Corporate India announced merger and acquisition deals worth $601 million in the month of September taking the year-to-date total to over $42 billion, a report by consultancy firm Grant Thornton said.

Though the number of merger and acquisition deals in the country more than doubled in the month of September, from 23 to 57, the total deal value remained more or less the same.

According to Grant Thornton's latest Deal Tracker, there were as many as 57 merger and acquisition transactions worth $601 million, while in the year-ago period there were 23 deals worth $597 million.

"Inspite of the high level of activity in M&A closing 57 deals in September 2010, the deal values have been significantly lower at $600 million, compared to increased momentum seen during the first seven months of the year," Grant Thornton's Partner (Specialist Advisory Services) C G Srividya said.

The deal sizes have been small or negligible and there have been only two M&A deals reported valued at over $50 million.

Most of the action has been in hospitality, power & energy and infrastructure related sectors, Srividya added.

The total value of 82 deals, including (M&A, private equity and qualified institutional placement) announced in September 2010 was $1.49 billion.

Domestic merger and acquisition deals were the flavour of the month with transactions worth $380 million.

The total value of outbound deals -- wherein Indian companies acquired businesses outside India amounted to $210 million, while in inbound deals, wherein foreign companies acquired Indian businesses amounted to $10

Giving further details the report said there were 15 outbound deals worth $210 million, compared to $10 million through nine deals in September 2009.

In September 2009, there were 11 domestic deals worth $580 million, while inbound deals constituted only a minuscule chunk with $4 million worth of M&A deals through three deals.

The top merger and acquisition deal in September this year, was Reliance Industries' 14.12 per cent acquisition in EIH Ltd for $217.23 million.

Other major deals include KEC International's acquisition of SAE Towers for $95 million, followed by Reliance ADAG's 15 per cent stake buy in KGS Developers for $47.87 million.

The top five M&A deals accounted for 71 per cent of the total deals value, Grant Thornton said.

A sector wise analysis shows that hospitality was the most targeted sector, as it attracted deals worth $224.47 million followed by power and energy ($95 million), IT & ITeS ($86.65 million), real estate ($47.87 million) and banking and financial services ($31.79 million), the report said.