Overseas M and A’s by Indian firms: an analysis

Abstract

In the recent years, there has been a significant increase in the number of mergers and acquisitions (M and A) by Indian firms. The numbers for overseas acquisitions are also on arise. The total number of M and A deals has significantly increased in last few years with overseas acquisitions increasing from 16 in 1995 to 168 in 2007. This document aims to analyze the following:The reasons for increase in overseas acquisitions by Indian firms. The overseas M and A trends across various sectors First part of this report analyzes the various strategic reasons as to why firms undertake M and A s. Then the various macro and micro economic, political, strategic reasons behind the increased overseas M and A s by Indian firms has been studied. Subsequently the reportfocuses on the trends in M and A s across various sectors. The firms in different sectors of Indian industry are exposed to dissimilar environments and thus, their needs and circumstances are very different from each other. Thus, the M and A trends in a particular sector may be unique to that sector only. Keeping this in mind, the mergers and acquisitions in nine major sectors of Indian industry are an alyzed separately. The patterns that are observed in terms of the number of deals over the period 1995-2008, are then analyzed further for the macro-economic rationale behind them. The next part of the report is about two case studies which have been developed on M and A activity in Automobile and Pharmaceutical sectors. The case studies aim to gather insights about the factors driving the activity in these sectors and the imminent challenges. The last section of this report summarizes all the major findings related to M and A trends in Indiain general and specific to certain sectors.