Press trust of india
Mumbai, Sept 17: Deal activity by corporate India in value terms zoomed nearly 38 per cent to $3.6 billion last month, driven by eight big-ticket deals worth over $100 million, says a report.
Overall deal value – mergers and acquisitions (M&A) as well as private equity (PE) transactions – stood at $2.6 billion during August 2015, according to accountancy and advisory firm Grant Thornton’s monthly deal-tracker report.
“August 2016 witnessed transactions worth $3.6 billion (134 deals) with a strong 38 per cent year-on-year boost in value while volumes declined by eight per cent year-on-year,” said the report. Individually, M&A activity contributed $2.5 billion to the overall deal value in August.
On the M&A front, cross-border deal value increased by 45 per cent as compared to August 2015, and there has been an almost three-fold increase in value in domestic M&A.
PE activity, however, declined from $1.7 billion in August 2015 to $1.1 billion in August 2016 once again this month, both in terms of value and volume.
“The month witnessed a big-ticket merger activity with the HDFC Standard and Max Life insurance deal, valued at above $777 million. This deal drove the deal activity in this segment,” the report said.
Further, the report found that the overall deal activity in the first five months of the current fiscal “has remained steady, with strong M&A growth driving a 6 per cent year-on-year rise in values, while PE investments sustained the deal volumes”.
“This year has witnessed large domestic transactions with the segment’s values growing two-fold year-on-year,” it said. “Six deals in the billion dollar club and seven deals over $500 million contributed to nearly 60 per cent of M&A deal values,” the report added.
However, the report noted that PE investments in 2016-17 till August-end have displayed a sharp 30 per cent drop in investment values compared to same period year-ago.
As per the report, August was dominated by persistent consolidation in the startup sector with 31 per cent of the M&A volumes with on-demand and online retail segments garnering much investor attention.
Telecom, agriculture and forestry, pharmaceuticals and manufacturing sectors witnessed big ticket deals values over $100 million each, it added.