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Things You Should Know About Mergers and Acquisitions

Finance: Investing

History

Mergers and acquisitions have gained substantial importance in the corporate world. This is a process which is used for restructuring business organizations. The concept was initiated by government bodies in India. Well known financial organizations followed suit and took the necessary steps to restructure the Indian corporate sector. The economic reforms of 1991 had opened a lot of challenges and opportunities for Indian as well as global companies. Global market competition prompted Indian companies to opt for mergers and acquisitions as a strategic business choice. Merger and acquisition trends have changed during the years and immediate effects have been diverse in the different sectors of Indian economy.

Indian Sectors

While various sectors of the Indian economy have been affected by mergers and acquisitions, the most notable among them have been finance, FMCG, telecom, steel industry, and automobile industry and construction materials. India is now among the global leaders with regard to mergers and acquisitions. The moves have helped to strengthen and consolidate the erstwhile disorganized sections and they have largely benefited from acquisitions and mergers.

Latest Trends

Till a few years back, Indian entrepreneurs acquiring global companies was unheard of. The situation has been overturned in the last few years with Indian businesses acquiring foreign companies to enhance their presence in the global economy and compete with the global players. This has given a much need boost to Indian companies confidence.

Various factors have played an important part in facilitating Indian acquisitions and mergers such as buoyancy in economy, favorable government policies, liquidity in the business sector and entrepreneurial attitudes of business leaders.

Indian ITES and IT sectors have already proved their mettle in the global economy and other Indian sectors are now keen to follow this trend. The growth of Indian business participation in the global corporate scenario has also facilitated global mergers and acquisitions.



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