NEW DELHI: With Bharti Airtel sealing the $10.7-billion takeover deal for African assets of Zain, corporate India's outbound merger and
acquisition (M&A) activity in 2010 so far has touched $15 billion.
The deal marks the second biggest overseas acquisition by an Indian company, after Tata Steel purchased Corus Group for $12.2 billion in an all cash deal in January 2007.
The Corus deal was the largest Indian takeover of a foreign company and made Tata Steel the world's fifth-largest steel group.
The acquisition of Zain's African assets would catapult Bharti Airtel to become the fifth largest telecom operator in the country with revenues of an estimated $13 billion and a subscriber base of over 179 million.
Led by Bharti-Zain, the outbound M&As by Indian corporate have touched $15 billion across 23 deals between January- March 23, 2010, according to Arun Natarajan, CEO of Venture Intelligence.
This is over seven-fold growth from $2 billion across 12 deals announced in January-March quarter of 2009.
"Confidence in deal-making is quite evident now. Although recovery in developed market is lagging, valuations in emerging markets are coming cheap leading to a lot of deals happening," Natarajan said.
Some of the acquisitions announced during the quarter include NMDC's $2.5 billion deal with Brazil's Ferrous Resources, Essar Group buying US-based Trinity Coal for $600 million also Bharti Airtel's $300 million buyout of Bangladesh's Warid.
The top 10 outbound deal involving India Inc has Kumar Mangalam Birla-led Hindalco Industries' acquisition of Canadian company Novelis Inc for $6 billion in February 2007 at the third spot.
This is followed by ONGC taking control of Imperial Energy Plc for $2.8 billion, in January 2009 and Tata Motors' acquisition of luxury auto brands -- Jaguar and Land Rover -- from Ford Motor for $2.3 billion in March 2008.
Also in May 2007, Suzlon Energy acquired the German wind turbine manufacturer REpower for $1.7 billion.
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