M&A activity in India up 33%

The mergers and acquisitions scenario during the first quarter of calender 2010 saw a significant quarterly increase in outbound deal value with a total M&A transaction value of $14 billion, making the quarter one of the best performing quarters in terms of value, according to a latest report by mergermarket, an independent mergers and acquisitions (M&A) intelligence service.

India’s M&A market accounts for over 4 per cent by value of deals in the Asia-Pacific and 11 per cent by deal count. The volume of inbound and domestic M&A deals in India has increased from 40 to 53 compared to Q1 2009, but deal value dropped from $5.1 billion last quarter to $4.7 billion, representing a 7 per cent decrease. Inbound activity has also had a strong start to the year, up 81 per cent by value and 69 per cent by volume over Q1 2009.

The Bharti Airtel’s $10.7 billion acquisition of Zain announced in March pushed the country’s total outbound deal value from last quarter’s $0.1 billion to this quarter’s $14 billion, making this quarter the second biggest quarter by outbound value on mergermarket records. Inbound activity was also strong in Q1 2010, with a significant 81 per cent and 69 per cent y-o-y increase by value and deal count respectively.

“Through acquiring Zain in March and purchasing a 70 per cent stake in Warid Telecom in January, Bharti Airtel has substantially strengthened its presence across the globe. Domestically, GTL Infrastructure purchased Aircel’s tower business and Quippo Wireless-TT Info-Services acquired Tata Teleservices’ tower portfolio in this quarter. All these deals provide clear evidence that the Indian telecom industry is consolidating, and at the same time aggressively working on global expansions. With the ongoing auction for national 3G spectrum licences, we expect to see more M&A deals in India’s telecom sector in the coming months,” said Vinu Lal, head of India Coverage at mergermarket.

Standard Chartered topped the financial advisor league tables by both value and volume in this quarter, having worked on four deals worth $13.1bn. Barclays Capital, also advised on the Bharti Airtel ô Zain deal, took the second place in the value table with three deals worth $13 billion. AZB & Partners beat its counterparts with 16 deals valued at $13.3 billion.