Cross-border M&As rise

Cross border transactions have doubled to worth $14.1 billion in first eight months of year

Cross-border mergers and acquisitions (M&As) are rising despite a slowing economy, data released by financial advisory company Grant Thornton show. The big deals included state-owned Oil and Natural Gas Corporation taking a 10 per cent stake in a Mozambique gas field for $2.6 billion from US energy giant Anadarko. This was ONGC’s fourth acquisition in the year.

These M&As doubled to $14.1 billion in the first eight months of the year from the year-ago period. While transactions excluding internal restructuring rose 55 per cent in the period to $17.8 billion, they fell 27 per cent after including restructuring deals to $18.9 billion.

Private equity (PE) deals till August rose 31 per cent to $7.6 billion, largely on the back of Baring purchase of a controlling stake in Mumbai-based software exporter Hexaware for $400 million.

“In our view, (this) is an increasing trend in PE deal dynamics. The recent foreign exchange devaluation is clearly helping the earnings of some of the export-oriented sectors like information technology and pharmaceuticals and it augurs well for inbound deals,” says Raja Lahiri, partner, transaction advisory services at Grant Thornton.