India's Q3 M&A activity at $5.7 bn; 9-mth deal tally at $17 bn

According to Mergermarket report, deal value declined 28.6% on a q-o-q basis and on a y-o-y basis it registered a 44% fall

India Inc's merger and acquisition activity during the July-September quarter amounted to $5.7 billion, taking the deal tally for the first nine months of this year to $17 billion, says a Mergermarket report.

According to the global deal tracking firm, deal value declined 28.6% on a quarter-on-quarter basis and on a year-on-year basis it registered a 44% fall.

In the second quarter of this year, corporate India had announced deals worth $8 billion, while in the first nine months of 2012, transactions worth $30.3 billion were made.

Meanwhile, the M&A deal value of $5.7 billion in the third quarter of 2013 also includes Apollo Tyres' $2.3 billion bid for Cooper Tire and Rubber.

Both inbound and outbound deal values plummeted in the third quarter of this year amid economic uncertainty in the global as well as domestic markets.

Inbound M&A deals plummeted 66.3% from $7.1 billion in second quarter of 2013 to $2.4 billion in the third quarter as "concerns surrounding the outcome of next year's general elections and the US Federal Reserves' planned 'tapering' kept foreign acquirers at bay," the report said.

Outbound bids totalled $2.8 billion in the third quarter of 2013, a 47.2% fall from second quarter of 2013 ($5.3 billion), it added.

Mergermarket further said the two acquisitions worth $5.1 billion by state-run ONGC and Oil India off the coast of Mozambique softened the impact of ONGC's failure to secure a $5 billion stake in Kazakhstan's Kashagan oil field.

Unilever's $3.5 billion acquisition of an additional 14.8% stake in Hindustan Unilever was the largest deal in India so far this year and accounted for 20.9% of aggregate M&A value in the country.

The size of the deal made the consumer sector as the most active sector for M&A in India.

Meanwhile, a sector-wise analysis shows that the pharma, medical and bio-tech sectors were the only sectors to witness a second successive uptick in M&A value.

An aggregate $1.8 billion worth of deals occurred in the sector during first to third quarter of 2013, the highest level since the same period of 2010 ($4.2 billion, $3.7 billion of which was accounted for by Abbott's landmark acquisition of Piramal Healthcare).

In terms of financial advisors ranking, Citi retained its position at the top with four deals, while Ernst and Young maintained its position as the most active financial advisor by deal count with 18 mandates.