The latest merger and acquisition (M&A) story in the pharmaceutical sector involves Dr Ranjan Pai and TPG who are to invest a whopping Rs 3,900 crore in Manipal Hospitals, for which a demerger approved has been received by Fortis Healthcare’s board. Is the season for M&A deals around the corner?
In 2017, more than 1,000 major mergers and acquisitions were seen, the highest in the current decade. And experts expect 2018 will follow suit. Over the years, India has witnessed a large number of such deals. Moneycontrol takes a look at the top mergers and acquisitions.
Vodafone-Idea merger | Deal size: USD 23 billion
Vodafone India and Idea Cellular, two of India’s top wireless carriers, are merging operations in the country to create an entity that will be equally owned by UK’s Vodafone Group and India’s diversified Aditya Birla Group. The USD 23 billion deal has received the CCI’s approval and is likely to be completed in 2018. This deal may well create India’s largest telecom operator.
Vodafone-Hutchison Essar | Deal size: USD 10.9 billion
Vodafone forayed into the Indian telecom market in 2007 after it purchased controlling stake in Hutchison Essar. Vodafone acquired 52 percent stake in the Indian telecom company for USD 10.9 billion, which was the biggest deal in the sector. Vodafone joined hands with Hutchison to penetrate the fast growing Indian market.
Ranbaxy-Daiichi Sankyo | Deal size: USD 4.6 billion
Daiichi bought the Singh brothers’ 34.82 per cent stake for USD 2.4 billion in 2008. The total deal value was USD 4.6 billion. However, problems emerged soon after the acquisition as Ranbaxy’s plants came under scrutiny by the US Food and Drug Administration (FDA).
Snapdeal and Freecharge | Deal size: USD 400 million
E-commerce startup Snapdeal acquired mobile recharge service Freecharge in April 2015. The cash plus stock deal was pegged at USD 400 million, making it the biggest acquisition in the history of India’s internet industry. When the deal took place, Snapdeal raised around USD 1.1 billion in funding, while Freecharge had a total funding of USD 120 million. Freecharge continued to operate as a separate entity following the acquisition, which allowed Snapdeal to expand its digital commerce ecosystem. After a turbulent last few months, Snapdeal finally sold Freecharge to Axis Bank for USD 60 million.
Flipkart and Myntra | Deal size: USD 300 million – 330 million
After months of speculations, India’s premier e-commerce startup Flipkart acquired its fashion-focused rival Myntra in May 2014, a move which was in light of Amazon’s expanding presence in India. Neither party confirmed the exact value of the acquisition, but reports placed the cash and stock deal between USD 300 million and USD 330 million. Myntra remained a separate entity following the acquisition and continued to expand its presence in the country, as did Flipkart. Myntra founder and CEO Mukesh Bansal was appointed on Flipkart’s Board and was made head of the fashion division of the e-commerce conglomerate.
Ola and TaxiForSure | Deal size: USD 200 million
Ola, one of India’s largest ride-hailing service, acquired the smaller-but-value-centric TaxiForSure for USD 200 million in a cash and equity deal in March 2015. The deal saw Ola expand its presence considerably in the country by adding TaxiForSure’s 15,000-plus fleet across 47 cities onto its own platform. TFS COO Arvind Singhal was appointed the company’s new CEO, while its founders Aprameya Radhakrishna and Raghunandan G served in advisory roles for a month before quitting. Even as both companies initially operated as separate entities, Ola shut down TFS in August 2016 and laid off 1,000 of its employees.
UltraTech Cement- Jaypee Group | Deal size: Rs 16,189 crore
UltraTech Cement completed the USD 2.54 billion acquisition of Jaiprakash Associates’ six integrated cement plants and five grinding units, having a capacity of 21.2 million tonnes last year. Post-acquisition, UltraTech has become the fourth largest cement player globally, excluding Chinese players. The deal has also helped Jaypee Group, which can reduce its debt that runs into thousands of crores of rupees.