India Registered 379 M&A Transactions in 2017

In 2017, India’s mergers and acquisitions activity reached the second highest annual deal value since 2001, according to London based  deals tracker Mergermarket, with 379 deals worth $54.7 billion. This is only slightly less than the peak registered in 2016, which saw 421 deals worth $59.7 billion. Telecommunications, technology, and financial services were the top sectors in terms of deal value for the year.

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Sectors Deal Value in $ Billion
  2017 2016
Telecom 20.4 0.7
Technology 9.6 5.6
Financial Services 6.9 5.1
Energy, Mining, Utilities 5.3 17.2
Industrials, Chemicals 2.9 3.5
Pharma, Med, Biotech 1.9 3.9
Real Estate 1.8 0.3

February 2, 2018   No Comments

AngelList Launches Syndicate Services for India

San Francisco-based AngelList, a crowdfunding platform and start-up community, launched ‘Syndicates for India’— a way for investors in India to invest alongside experienced angels and venture investor funds that invest in India’s vibrant tech ecosystem.

AngelList Logo

For investors, syndicates are a private single-deal investment vehicles that let an investor invest in startup allocations shared by syndicate leads, enabling more angels to participate by getting access to top deals. Similar to a venture investor fund, syndicates provide experienced investors the opportunity to earn carried interest on their allocation, and the ability to write bigger checks by pooling capital from dozens of backers in the ecosystem

These syndicate programs operate in the U.S., Canada, and the U.K. and through them, AngelList has facilitated investments of $700 million combined in over 1,800 start-ups including Uber and Indian start-ups such as ClearTax, DocTalk and Squad.

January 24, 2018   No Comments

Mauritius Continues to Be Largest Channel for FDI to India

Based on a census that it undertook, a report by India’s central bank, the Reserve Bank of India, said, “Mauritius was the largest source of foreign direct investment (FDI) in India (21.8 percent share at market value) followed by the U.S.A., the U.K., Singapore and Japan, while Singapore (19.7 percent) was the major overseas direct investment destination (ODI), followed by the Netherlands, and the U.S.A.” The census yields comprehensive information on the market value of foreign liabilities and assets of Indian companies arising from FDI, ODI and other investments.  Historically foreign investors who expect capital gains from the ultimate sale of their stake prefer to invest via this tiny island nation due to a favored tax deal between India and Mauritius.

Reserve Bank of India logo

Other key findings of the census were:

  • Of the 18,667 companies that participated in the census, 17,020 had FDI/ ODI in their balance sheets in March 2017
  • “96 percent of the responding companies were unlisted in March 2017 and most of them had received only inward FDI; unlisted companies had a higher share of FDI equity capital compared to listed companies”
  •  Over 80 percent of the 15,169 companies that reported inward FDI were subsidiaries of foreign companies (single foreign investor holding over 50 percent of the total equity)
  • Non-financial FDI companies had a much higher share in total foreign equity participation compared to financial FDI firms.
  • “The ratio of market values of inward to outward direct investment, increased to 4.3 in March 2017 from 3.6 a year ago; equity participation accounted for 94 percent and 79 percent shares in inward and outward FDI, respectively,”
  • The manufacturing sector accounted for nearly half of the total FDI at market prices; information and communication services and financial and insurance activities were the other major sectors that attracted FDI.
  • Total sales, including exports, of foreign subsidiaries in India increased by 18.7 percent during 2016-17 whereas their purchases, including imports, increased by 20.1 percent.

January 24, 2018   No Comments

India’s Ipca Labs Acquires U.S.-based Pisgah Labs

Mumbai-based Ipca Laboratories announced the acquisition of a 100 percent share capital of Pisgah Labs Inc., a North Carolina corporation, by the company’s wholly owned subsidiary Ipca Pharmaceutical Inc., U.S.A., and Onyx Scientific Ltd., U.K. (Ipca Labs’ wholly-owned step-down subsidiary) for $9.65 million, free of debt.

Since its incorporation in 1981, Pisgah has been a contract manufacturer and developer of active pharmaceutical ingredients and intermediates. For the financial year ended April 30, 2017, Pisgah Labs accrued a total income of $2.89 million and EBIDTA of $1.14 million.

Medication

“Onyx and Pisgah’s capabilities in chemistry services will dovetail effectively with the company’s capabilities in supporting Phase II to commercial scale programs and also enable the company to manufacture small volume active pharmaceutical ingredients for the U.S. market,” a company statement said.

January 21, 2018   No Comments

Nielsen Renews $2.25 Billion Contract with India’s TCS

Mumbai-based Tata Consultancy Services Ltd (TCS) won a $2.25 billion contract, the largest ever for an Indian information technology firm, from U.K.-based television ratings measurement company Nielsen. Under this contract, TCS is assured of $320 million in business from Nielsen every year, beginning 2017 through 2020, $186 million in annual revenue from 2021 through 2024 and $139.5 million in 2025, according to a regulatory filing made by Nielsen to the U.S. Securities and Exchange Commission.

TCS will globally provide Nielsen with professional services relating to information technology (including application development and maintenance), business process outsourcing, client service knowledge process outsourcing, management sciences, analytics, and financial planning, reports LiveMint.

TCS Logo

“This is a milestone contract given not only the depth of the contract but also the breadth of services,” said Ray Wang, founder and CEO of Constellation Research, a technology advisory firm. “TCS did a good job of managing longer-term costs and gaining some cost efficiencies while renewing a longer contract. There is also upside in the long run as this is more of a strategic partnership than outsourcing contract.

December 23, 2017   No Comments