Year 2007 will go down as a golden year for Indian MNC’s in the field of mergers and acquisitions. A rising GDP and a good economic growth right from the beginning of the century made way for the Indian companies to dominate the global economies…. Since everything started turning into the favor of the Indian economy, since the turn of the century it helped the Indian firms to gain competitive advantage to face global competition as well it supported them to build strong balance sheet till the mid of this decade. To give you a small idea of the scenario, Indian companies clocked an astonishing 335 deals for 43.97 billion dollars for the year 2007.
The good part is that all the deals were into different fields. The Indian firms acquired not only strike deals in a particular sector but they were everywhere, right from metals, pharmaceuticals, industrial goods, automotive components, beverages, cosmetics and energy in manufacturing; and mobile communications, software and financial services in services, with pharmaceuticals, IT and energy being the prominent ones among these. The good part is that most of these deals were cash deals which gave a good picture of the Indian firms’ strong financial positions
But now it seems as if the Indian economy is losing its steam. In the year 2008 the total number of deals stood at 265 with a value of 18.54 billion dollar against the 335 deals having a value of 43.97 billion dollars, in the year 2007. But still I consider it as a temporary phase which will fade away slowly over a period of time. The recent happenings such as the inflation rate and the sub prime crisis do not give a clear picture but the strong foundation, healthy balance sheets, growing economy, business principles and ethics and a bit of support by the government is bound to help Indian firms in more mergers and acquisitions in the coming future.
