Corporate India’s shopping spree witnessed a significant slump in the very first month this year as the targeted merger and acquisition (M&A) volume reached $615 million — the lowest January volume since 2003, says a report.

According to global deal tracking firm Dealogic, India’s Targeted M&A volume reached $615 million last month, an 84 per cent drop from the same month last year when transactions worth $3.8 billion were announced.

Moreover, it was also the lowest January volume since 2003, when deals worth $150 million were announced.

In terms of number of deals as well, there was a significant slump as there were just 51 deals recorded in January, down 53 per cent compared to January 2012 when 109 deals were recorded.

January also witnessed the lowest activity level since 2005, when just 35 deals were recorded, Dealogic said.

The drop in deal volume was largely fuelled by 87 per cent drop in the country’s domestic M&A volume to $378 million in January 2013, compared to the $3 billion recorded in January 2012, Dealogic said.

Meanwhile, India’s share in the Asia (ex-Japan) Targeted M&A volume also witnessed a significant decline in January.

The India targeted M&A volume last month accounted for only 3 per cent of Asia (ex-Japan) which was $ 24.2 billion, down from the five-year average of 15 per cent share and stood at the lowest percentage since 2003 (2 per cent), Dealogic said.

India cross-border inbound M&A volume also fell 65 per cent to $237 million in January 2013, from the $ 670 million announced in the comparable 2012 period.

In contrast, India cross-border outbound M&A volume stood at $647 million in January 2013, up from just $30 million announced in the same month in 2012.

(This article was published on February 5, 2013)
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