Inbound M&A deal volumes surge by 30% in 2011

Foreign companies acquired majority stakes in 131 Indian companies during 2011, registering a 30-per cent rise in such transactions as compared to the previous year, according to a study by Venture Intelligence, a research service focused on private equity and M&A transaction activity in India. Of these inbounds deals, there were 65 deals with an announced value of $9.99 billion.

In comparison, 2010 had witnessed a total of 101 inbound deals, of which, there were 50 transactions with announced values totaling almost $8.4 billion.

The largest inbound M&A deal by value announced during 2011 was Vodafone's March 2011 buyout of the Essar Group's stake in mobile phone services firm Vodafone Essar for $5.46 billion.

The second largest inbound deal during the year was the acquisition of BPO firm Intelenet by UK's Serco Group for an estimated $630 million, followed by International Paper's acquisition of a 75-per cent stake in publicly-listed Andhra Pradesh Paper Mills for $388 million. US-based companies, followed by English and Japanese firms, were the leading acquirers of Indian companies during 2011, the Venture Intelligence data showed.

The volume of outbound deals – ie, Indian companies acquiring overseas companies / assets - dipped by about 35 per cent year-on-year to 127 deals in 2011 compared to 194 such transactions in the previous year.

Among these, there were 62 deals with an announced value of $9.9 billion (against 104 such deals worth $23.7 billion during 2010). In the largest outbound deal, Mundra Port & SEZ acquired the Abbot Point Coal Terminal in Queensland, Australia for $2 billion. In another major outbound acquisition GVK Power & Infrastructure acquired various Australia-based coal mines from the Hancock Group for $1,260 million.