India M&As Are Still in the Cloud

Bankers in India recorded their best quarter for mergers and acquisitions while dealmaking elsewhere slows to a whirl. India had $82.3 billion pending and completed M&A deals in the second quarter, the highest amount on record, according to data compiled by Bloomberg. That is more than twice as much as the previous record of $38.1 billion in the third quarter of 2019. M&A volume in the quarter reached $827.6 billion, a decline of 8.7% from the same period in 2021, according to the global market. India was dominated by the surge. In April, a $60 billion all-stock purchase of Housing Development Finance Corp. was merged with India's most valuable bank and largest mortgage lender in the country's biggest M&A transaction. India's flagship companies are facing disruptive trends such as the rise of fintech and climate change as a tactic to reshape themselves. According to Sonjoy Chatterjee, chairman and chief executive officer for Goldman Sachs Group Inc. in India, there will be renewed or new initiatives around two big themes: ESG and digital. He said that the second is a focus for all companies, no matter the sector. Chatterjee said that there won't be a strategy going forward that doesn't provide a clear path to deliver this. The combination of. In a $3.3 billion all-stock deal announced in May, India s largest firms are positioning themselves for a changed landscape in technology aided by volatility in the markets, as illustrated by the two software firms Larsen Toubro Infotech Ltd. and Larsen Toubro Infotech Ltd. Even without themegadeal, India's second quarter would still rank as its fifth-best quarter on record, thanks to transactions such as billionaire Gautam Adani's $10.5 billion deal to buy. His conglomerate has a sizable presence in the industry. The appetite of strategic investors has increased with market correction resetting the valuations in India, said Ganeshan Murugaiyan, head of corporate coverage and advisory atSA in India. The companies in India leading the shift to renewable energy were some of the biggest dealmakers. Shell Plc agreed to buy renewable power supplier Sprng Energy Pvt for $1.5 billion in April, while French oil giant TotalEnergies SE purchased a 25% stake in Adani New Industries Ltd. this month. The firm plans to invest more than $50 billion in technologies such as green hydrogen over the next decade. Large acquisitions will be difficult to put together, Murugaiyan said. It is not easy to get long term financing and the high-yield leverage buyout market-backed corporate loans are literally shut down. Like Chatterjee, Murugaiyan sees the green and digital transitions driving more transactions. His team has grown from nine bankers in 2021 to 12 this year, and he is looking to add another three. The next wave of deals could come in the mid-market, where a cohort of aging founders is starting to hand over the reins to their offspring. Chatterjee said that the next generation has interests in other topics, particularly tech platforms and ESG. Themes coming out of the pandemic have revised perspectives and choices around what the next generation wants to do with their futures - in a very personal way.