M&A deals value dips in India between Apr-Sept, 2011

Corporate India announced 177 merger and acquisition deals worth $26.8 billion in the first nine months this year,

a 41.5% decline vis-a-vis the corresponding period a year ago,

according to mergermarket report.

As per the report by global advisory firm mergermarket, titled 'Indian M&A Roundup Q1-Q3 2011', Indian M&A saw a 41.5% decline in the value of M&A deals in the first nine months of 2011 and a 16.9% drop in terms of volume, compared to the same period of 2010.
"With India's benchmark Sensex slumping almost 23% year-to-date, rising inflation and interest rates and ongoing global woes, it is not surprising that domestic M&A dwindled in the Q1-Q3 2011 compared to the same period last year," Anjali Naik, the Deputy Editor of mergermarket, Asia-Pacific, said.
While the valuations and volume of M&A deals was muted, activity is expected to continue on a smaller scale in the industrials and chemicals, financial services and consumer sectors, Naik added.
Inbound deals worth $7.32 billion were recorded in the third quarter (July-September), compared to $2.65 billion in the previous quarter.

The total value of M&A deals in the first nine months of 2011 was largely accounted for by two inbound deals -- BP's $7.2 billion transaction for acquisition of stake in Reliance Industries' oil and gas properties and Vodafone Group Plc's purchase of partner Essar's 33% stake in Vodafone Essar Ltd ($5.46 billion).

The Vodafone Group Plc/Vodafone Essar Limited deal announced in July was the second largest transaction recorded in the first nine months of 2011, boosting the Q3 inbound deal value to $7.32 billion, mergermarket said.

A sector-wise analysis shows that the energy, mining and telecommunications sectors accounted for more that 50% of the total value of M&A deals involving Indian entities. However, each of the sectors saw a sharp decline when compared to the corresponding period last year.

The value of M&A deals in the energy and mining sectors stood at $7.83 billion, a fall of 35.6%, while telecommunications sector transactions amounted to $6.13 billion (down 68.7%).