India became the world’s eighth largest market in the first quarter of 2007 — an improvement over the 11th rank in calendar year 2006. According to Alan S Alpert, managing partner (M&A transaction services), Deloitte Tax LLP, there has been a substantial increase in M&A in India. Inbound M&A (into India) and local M&A have been growing.
The Vodafone Hutch accounted for the majority of the gains in the first quarter. Also the number of M&A transactions by Indian companies overseas has gone up substantially. The US and the UK continues to be the number one and two M&A market. According to Thomson Financial, in the first quarter India saw inbound and local deals of $25.581 billion.
In the first quarter India pipped markets like France (2006: $76.8 billion, 2007: $24.79 billion), Italy (2006: $17.40 billion, 2007: $14.79 billion), Luxembourg (2006: $34.65 billion, 2007: $2.5 billion). According to Mr Alpert, India has now surpassed China and South Korea in the Asian M&A league table and is behind only behind Japan.
He added that the global M&A saw record levels of deals worth $3.7 trillion in 2006. However, there has been a shift in the participants in the M&A market. Around three to four years ago private equity players contributed to around 10% of the deals. In 2006 however, this has now changed to 25%. PEs have been gaining force on the back of liquidity and a stable economy.
That could be the reason why players like Deloitte have launched a dedicated private equity practice here — Deloitte Corporate Finance Services India. The team in India is led by managing director Sandeep Gill and director Bomal Modi. Both were earlier part of the corporate finance practice of Deloitte & Touche LLP In London.
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