NEW DELHI: Corporate India witnessed merger and acquisition deals worth $1.5 billion through 28 transactions in October, registering a 45% decline over the same month last year, a report said on Thursday.
According to Grant Thornton’s latest M&A Dealtracker, there were 28 M&A deals worth $1.5 billion in October this year, while in the same period last year 47 such deals were announced worth $2.8 billion.
While the overall M&A deal value and volume in October declined as compared to the year-ago period, on a month-on-month basis, there was an increase, showing signs of improved sentiments.
“This was driven by the corporate tax cut, which has improved both investor sentiment and confidence. This also resulted in the average deal size more than doubling from $24 million in September 2019 to $55 million in October 2019,” the report said.
The energy sector dominated October’s M&A in terms of values with 64% contribution to total M&A deals, driven by the largest bet on India’s clean energy with Total SA’s 37% stake acquisition in Adani Gas for $0.9 billion.
Other sectors that attracted major deals during October include pharma sector, pushed by
Metropolis
Healthcare’s acquisition of four pathology labs to fortify its foothold in
Gujarat
, followed by deals in the automotive, banking and energy sectors.
“Deal volumes were fairly spread across pharma, automotive, banking and financial services, energy and
natural resources
, IT and ITeS, and media and entertainment sectors,” Pankaj
Chopda
, director, Grant Thornton India LLP, said.
He further noted that “manufacturing, energy and natural resources, pharma, healthcare and biotech, IT and ITeS, and banking and financial services sectors are expected to contribute to M&A transactions. However, the absence of large ticket M&A transactions will weaken the overall deal activity”.
The January-October deal activity continued to witness weak performance in terms of both deal values and volumes compared to the year-ago period.
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