<article>Domestic merger and acquisition (M&amp;A) activity in the September quarter accounted for two-thirds of the total number of deals year to date despite an uncertain global environment, advisory firm EY said in a report.</article>

Domestic merger and acquisition (M&amp;A) activity in the September quarter accounted for two-thirds of the total number of deals year to date despite an uncertain global environment, advisory firm EY said in a report.
Domestic M&amp;A activity continued to dominate India’s deals landscape, recording 137 transactions with an aggregate disclosed value of $7.3 billion in the three months ended 30 September. This was about 65% of the total deal volume, compared with about 54% in the year-ago period, and about 64% of the total disclosed deal value, compared with 32% a year earlier.
The increase in deal value was driven by large domestic transactions such as <a style="color: #000080;" href="http://www.dealstreetasia.com/?s=Nirma">Nirma</a> Ltd’s acquisition of the India cement business of <a style="color: #000080;" href="http://www.dealstreetasia.com/?s=LafargeHolcim">LafargeHolcim</a> for $1.4 billion and the merger agreement between <a style="color: #000080;" href="http://www.dealstreetasia.com/?s=Housing+Development+Finance+Corp">Housing Development Finance Corp</a>. and <a style="color: #000080;" href="http://www.dealstreetasia.com/?s=Max+Group">Max Group</a> for their life insurance businesses.
“The domestic deal environment continues to be healthy since strong manufacturing activity and consumption levels are likely to keep corporate earnings thriving. Moreover, the <a style="color: #000080;" href="http://www.dealstreetasia.com/?s=RBI">RBI</a>’s (Reserve Bank of India) move to ease monetary policy on the back of a benign inflation environment will likely increase private investments, and drive momentum behind M&amp;A activity,” the report said.
Consolidation deals in sectors such as infrastructure and retail are expected to boost M&amp;A activity going ahead, the report said.
However, despite the increase in domestic M&amp;A transactions, overall M&amp;A activity in the third quarter was weak. The quarter recorded 210 deals with a total disclosed value of $11.3 billion. In terms of deal volume, this was 15% lower than in the corresponding quarter last year.
Cross-border M&amp;A activity declined in the third quarter, with deal volume declining substantially to 73 from 114, while the deal value declined by 33% to $4 billion.
The quarter recorded 29 outbound deals, contributing $277 million to the disclosed deal value as compared with 33 deals, accounting for $3.3 billion last year.
This significant decline in outbound deal value was due to the absence of mega deals, the report said. “3Q15 had seen three mega deals totalling $2.7 billion in the pharmaceuticals and oil and gas sectors”, it said.
There were 44 inbound deals with a disclosed deal value of $3.8 billion in the third quarter, as compared with 81 deals totalling $2.7 billion in the previous year, adding to the decline in the overall cross-border deal volume.
“While the overall deal activity was muted due to an uncertain global environment, the domestic M&amp;A activity remained healthy owing to strong macroeconomic environment and the growing need for digitalization across all sectors. On the cross-border front, both the inbound and outbound activity was impacted due to a slide in investors’ confidence and negative business sentiments globally,” said Amit Khandelwal, partner and national director, transaction advisory services at <a style="color: #000080;" href="http://www.dealstreetasia.com/?s=EY">EY</a>. However, he added that in the longer term, M&amp;A activity is expected to pick up as the global environment stabilizes.
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<h4 style="text-align: justify;">This article was first published on <a href="http://www.livemint.com/Companies/8Fn0hRQNjigILA9RaiE3sO/Domestic-MA-activity-continued-to-dominate-deals-landscape.html">Livemint.com</a></h4>

Domestic M&A activity in the September quarter accounted for two-thirds of the total number of deals year to date despite an uncertain global environment,

Domestic M&A activity dominates India deals landscape in Q3

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