M&A deals value involving Indian cos touch $4.7 bn in Jul-Sept

Most of the transactions were on the domestic front, says a survey by EY

Total value of mergers and acquisitions involving Indian companies touched USD 4.7 billion in the July-September quarter of 2014, while most of the transactions were on the domestic front, says a survey.

Global consultancy EY today said M&A activities involving Indian companies are anticipated to gain traction over the coming months on the back of a relatively stable political scenario.

In the July-September quarter, total value of such M&A deals touched $4.7 billion spread across 203 transactions.

"The technology sector dominated the M&A league tables, accounting for 27 deals that reflect a strong focus on services and solutions around healthcare IT," EY said in a statement.

However, in terms of value, it was lower than $5.4 billion seen during the 2013 September quarter even as the number of deals were less at 167.

On a comparative basis, the decline in overall value of transactions "attributable to one mega deal of $2.6 billion in Q3 2013 by ONGC Videsh of a ten per cent stake in Mozambique's Rovuma 1 offshore block," the statement said.

According to EY, if that deal is excluded, the latest September quarter registered an increase of 71 per cent in deal value compared to the year-ago period.

"M&A activity is expected to gather traction over the next few months owing to rising investor confidence that is being fuelled by a relatively stable political scenario," Amit Khandelwal, Partner and National Director (Transaction Advisory Services) at EY said.

Among the 203 M&A deals seen in 2014 September quarter, as many as 124 transactions worth around $2.4 billion were on the domestic front.

The total value of such deals touched $1 billion in the three months ended September 2013 and at that time, their count stood at 101.

"This increase in domestic deal activity was due to large number of acquisitions done by Indian companies domestically to drive exponential growth," EY said.

Noting that in July-September quarter, M&A activities were driven by companies' focus to de-leverage and restructure their operations, Khandelwal said this trend is expected to continue, especially in the power and utilities sector.