India Inc's M&A deal value shrinks in April: Grant Thornton

Says on the cross-border front, volumes have remained flat but deal value has come down significantly

Corporate India announced merger and acquisition deals worth USD 1.19 billion through 58 transactions in April, registering a decline of 83 per cent in value terms over the year-ago period, says a report.

In April 2014, there were 48 transactions worth USD 6.8 billion, the report by Grant Thornton said.

According to the assurance, tax and advisory firm, the deal tally in the first four months of this year amounted to USD 6.79 billion. The deal tally in January-April 2014 stood at USD 11.31 billion.

"This was largely because 2014 witnessed the USD 3.2 billion Sun-Ranbaxy merger," the report said, adding that on the cross-border front, volumes have remained flat but deal value has come down significantly.

Going forward, the deal tally is expected to improve.

Grant Thornton India LLP Partner Prashant Mehra said though the government will surely need to push things on the ground to deliver data points demonstrating growth and potential, there is a definite momentum as overall macro level indicators look positive.

"The coming few months will hopefully be exciting for M&A and PE deals," Mehra added.

In terms of sector spread, the IT&ITeS and pharma emerged as favourites for M&A, contributing 65 per cent in total deal values, while manufacturing sector contributed 19 per cent.

April witnessed big ticket deals in manufacturing like MESCO Steel's acquisition of Maithan Ispat for USD 187 million, contributing 19 per cent of the total deal value.

Other major deals of the month include Dr Reddy's Laboratories select portfolio acquisition of established brands of Belgian firm UCB in India, Nepal, Sri Lanka and Maldives for USD 128 million.

Infosys' acquisition of US-based digital experience solutions company Kallidus for USD 120 million and Diageo taking full control of South African beer maker United National Breweries by acquiring the additional 50 per cent stake in the company from Vijay Mallya-controlled Pestello Investments were also among the deals of the month, the report said.