India Inc announces M&A deals worth $1,893 mn in February: Thornton report

Corporate India announced merger and acquisition (M&A) deals worth $1,893 million in February this year, registering a 40 per cent increase in value terms over the year-ago period was driven by big-ticket transactions, says a report.

According to assurance, tax and advisory firm Grant Thornton, there were 40 M&A transactions worth $1,893 million in February, while in the corresponding period a year ago there were 32 such deals worth $1,354 million.

This increase in M&A deal value in February was driven by big-ticket consolidation that saw four deals valued over $100 million contributing to 79 per cent of the total M&A values.

In February, IT & ITeS sector led the deal activity accounting for 39 per cent of total deal value driven by Birlasoft's merger with KPIT Technologies. IT solutions sub-segment continued to attract investors' attention as 50 per cent of IT deal volumes were in this segment, the report said.

However, on a month-on-month basis, February saw 84 per cent decline in value terms, as four-billion-dollar deals were recorded in January this year, while no such transaction was announced in February.

The report further noted that the first two months of this year saw 87 M&A transactions worth $17,030 million, registering a nearly five-fold increase over last year, primarily on account of revived domestic deal activity, which saw over six-fold increase in deal values. The year so far registered four deals in the billion-dollar category and seven deals valued over $100 million accounting for 95 per cent of total M&A deal values.

Energy, telecom, banking & IT sectors dominated the deal activity in terms of deal values capturing 92 per cent, while start ups sector dominated the deal volumes with 25 per cent.

"Closure of insolvency proceedings window for the initial set of companies identified under the Insolvency and Bankruptcy Code Act and equity issuance for debt reduction will also continue the trend for M&A transactions," said Pankaj Chopda Director at Grant Thornton India LLP.