IT, finance, real estate grab 52% share in mergers and acquisitions (M & As) during June and July 2011 : Assocham

Information technology, financial and real estate sectors cornered nearly 52 per cent share in mergers and acquisitions (M & As) out of 68 deals during June and July 2011, according to the latest Assocham Financial Pulse study.

International deals were the biggest contributor to M & A activity in past two months with a share of 54.4 per cent. This was followed by domestic market which has a share of 20.6 per cent, said The Associated Chambers of Commerce and Industry of India (ASSOCHAM).

The share of inbound deals – percentage of foreign companies that acquired Indian firms – comprised only 7.4 per cent of the total activity.

The IT sector witnessed maximum buoyancy in M & A activity with a total of 18 deals finalised – one inbound, two domestic, three outbound and 12 international. This shows Indian companies are trying to gain entry into new markets besides increasing the product and services portfolio,

The key global deals included acquisitions of Median AG by Lenovo, Echosign by Adobe and Gen-i Software Solutions by Indian IT major Infosys.

In the real estate sector five international deals happened in the United States. There was one case of Indian company acquiring a foreign company and one of Indian company acquiring another Indian company.

Seven M & A deals took place in banking, financial service and insurance sector with EXL Service Holdings acquiring Outsource Partners, Northern Trust acquiring Band of Ireland Securities Services and IDBI acquiring Universal Commodity Exchange.

In June, all deals were of international nature while July witnessed an outbound deal in which Religare Enterprises acquired Noah to improve its South African market.

The key acquisitions in telecom sector included Vodafone acquiring 22 per cent stake in Essar Communications for 3.32 billion dollars and ICICI acquiring a stake in GTL.

Other M & A involving Indian majors included Mundra Port acquisition of Abbot Point Coal for 1.8 billion dollars, Jindal Steel and Power (Australia) increasing stake in Rocklands Richfields from 14.46 per cent to 27.29 per cent, Aditya Birla Group acquiring Columbian Chemicals and Godrej’s acquisition of Darling Group Holdings to enter the South African fast moving consumer goods market.

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