India Inc.

Indian companies have been on a global acquisition spree. Over the last couple of years, Indian Companies has acquired a slew of foreign companies across a spread of sectors in their quest to go global.

India Inc. is flying high not only over the Indian sky, but many Indian firms have slowly and steadily embarked on the global path and led to the emergence of new breed of companies i.e., Indian multinational companies. The rising tide of Indian investment overseas reflects the imperatives of operating in a globalised market place. Investments from India are no longer chasing just stressed assets in the US and Europe or for that matter mining resources in Australia but are largely placing focus on greenfield projects around a larger geography. Indian companies has spanned a large number of countries across continents, finding their way into both developed and developing markets, including the US, Europe, Africa, China and other Asian countries. Similarly, it's not just the Tatas, Ambanis and the Ruias, who are scouting for opportunities in foreign lands, corporate groups of all sizes are exploring options outside to get access to the global markets. Companies across a widespectrum of industries ranging from pharmaceuticals to telecom, automobiles and ancillaries to IT, paints to paper have set up facilities abroad. India is actually providing an invaluable springboard for companies to go global. Indian companies are high on organic growth globally as the home markets have lesser scale or the resources to allow them to deliver the levels of shareholder value and competitive advantage they want to achieve.

The cutting edge competition and the cost edge are the key driving factors that helps produce the right products for the times and ensures value for dollar for the global consumer. This competitive edge help India win major acquisitions in global markets and emerge as important customers, business partners and competitors to the worlds largest companies. Optimizing operational efficiencies through an altered matrix of cost, resources, logistics and markets is driving these exploratory decisions. The growing aspirations of Indian corporate entities to go global are aided with the fact, that access to international financial markets to fund cross-border acquisitions is far easier now. In a survey carried out by the Indian School of Business, Hyderabad in 2011, titled Transnationality Ranking of Indian Companies, Indian companies have been ranked on the basis of their overseas assets, revenue and employee numbers. The ranking methodology was based on a framework developed by the United Nations Conference on Trade and Development (UNCTAD) The survey shows that more than half the top 15 transnational companies are affiliated to business groups, a phenomenon unique to emerging economies, with companies from the Tata group dominating the list. [Brief snapshot of the survey is produced herewith]

India marked 268 Deals at US$36.3 billion in 2012

Indian M&A in 2012 saw a strong rebound in aggregate deal value, standing at US$ 36.3bn, 22.6% higher than 2011. Deal volumes exhibited a similar trend, with the 2012 total of 268 deals representing a 7.6% increase from the 249 deals registered during 2011. However, deal volume in Q4 2012 fell 9% from Q3 2012 to 61 deals, and deal value in Q4 2012 dropped 26.3% from Q3 2012 to US$ 7.1bn.
Top 5 Deals of 2012
Announcement Date Bidder Company Target Company [Source: Mergermarket report] Seller Company Deal Value (US$m)

25.02.2012 26.11.2012 23.08.2012 01.09.2012 31.01.2012

Sesa Goa Limited ONGC Videsh Ltd Government of Japan; and Japan Bank for International Cooperation Diageo Plc Centurion Investment Company

Sterlite Industries (India) Limited North Caspian Sea Production Sharing Agreement (8.4% Stake) Delhi Mumbai Industrial Corridor Development Corporation Limited (26% Stake) United Spirits Limited (53.4% Stake) UAE Exchange & Financial Services Ltd (40% Stake) Mr BavaguthuRaghuram Shetty ConocoPhillips Company

10,289 5,000 4,500 3,354 2,000

The Intelligence Heat Chart is produced below which is based on Companies for Sale tracked by mergermarket in Asia between 05/06/2012 and 04/12/2012. If reports of mergermarket are to be considered than, opportunities are captured according to the dominant geography and sector of the potential target company. Consumer & retail, healthcare and industrials sectors will drive M&A in future years.

Outbound deals of India Inc. at US $11.2 billion in 2012

Year 2012 ended with a positive note with the last quarter seeing a spurt in deal activity. In 2012, Indian companies made total 72 acquisitions abroad worth US$11.2 billion, an improvement over 2011s deal value of US$6.7 billion, 68.5% jump from last year according to Business Standard. The outbound wave has seen a notable shift over the past decade, changing from deals centered on IT and pharmaceuticals to acquisitions in the consumer and energy space. In terms of outbound target sectors, in 2012 Indian companies made major acquisitions into energy, mining and utilities, with totals reaching US$6 billion, accounting for 55% of deal activity for the year. Notable buys were ONGC Videshs purchase of an 8.4% stake in a major ConocoPhillips oilfield in Kazakhstan for US$5 billion. That deal was the largest natural resource deal ever for an Indian business. By geography, Indian companies have typically targeted Western jurisdictions. Taking advantage of attractive valuations in distressed markets, Indian companies are finding cheap buys in advanced markets. A recent trend has seen India-based businesses investing in emerging markets, utilizing best practices learned domestically to acquire assets in markets in Central and Southeast Asia. A first-hand familiarity with the deal process in emerging markets, and the various intricacies that can often occlude deals from reaching completion, puts Indian businesses at a competitive advantage over their western rivals. However, Indian corporates need to tread softly before committing resources to unfamiliar markets.

Deal volume plunged 75% in Q1 2013 India Inc. in its first quarter of 2013 has witnessed a significant slowdown as deal volume plunged 75 per cent over last year possibly driven by interplay of factors given the macro conditions as well as the pressure on liquidity. Uninspiring and monotonous Indian budget, the weakening of the Indian rupee against sterling, investor concerns on government policy and its slow implementation are also the major contributors to this decline. Outbound M&A deal value with the 2013 first quarter clocking up US$0.19 billion as against US$0.69 billion in Q1 of 2012 and US$1.73 in Q1 of 2011. Even the number of outbound deal is reducing consistently with just 21 deals in Q1 of 2013 as against 26 deals in Q1 of 2012 and 34 in Q1 2011. In total there were 219 deals in Q1 2013 out of which 129 deals were M&A and the deal value at its lowest level amounting to US$4.56 billion. PE activity continues to dominate with over 90 deals although overall deal value dropped to US$1.3 billion. Quarter Summary

[Source :Grant Thornton]

Outbound acquisition by India Inc. during January -April 2013

April
Tata Technologies buys American Engineering Firm Cambric Corporation for US$32.4 Mn. Windsor Machines sets up Dutch unit to acquire Italian Firm Italtech through a JV entity. Tech Mahindra has acquired Type Approval Lab from Sony Mobile based in Sweden for undisclosed amount. Bharti Airtel has entered into a definitive agreement with the Warid Group to fully acquire Warid Telecom in Uganda. Eka Software has acquired EnCompass Technologies based in Calgary, Canada. Minda Industries has acquired Clarton Horn S.A.U., Spain from PMAn Domestic AG, Germany for Euro 6.8 Mn. Technocraft has made a strategic acquisition of EPCM Canadian Firm - Swift Engineering Inc. TCS has acquired a French IT Firm - Alti SA for a value of 75 Mn in an all-cash transaction. East India based conglomerate PCM Group has acquired a century old German Rail Infra Firm - Rail.One for 36 Mn Euros through PCMs subsidiary, SPV PCM Germany GmbH. Mahindra Holidays has acquired 49% stake in Arabian Dreams Hotel Apartment in Dubai.

 Online retailer Mynta has acquired Fitiquette, a company in San Francisco developing virtual fitting rooms for undisclosed amount.

March
Zee Entertainment and Asia Today Ltd. unit have made an undisclosed strategic investment in British Ad firm MirriAd. Prime Focus is planning to acquire bankrupt Hollywood visual effects company Rhythm & Hues. Lite Bite Food has acquired Italian Restaurant Scalini. AGC Networks has acquired Transcend United Technologies, through its subsidiary AGC Network Inc. in North America. Aptus Industries is planning to acquire British Firm SoftSync Inc. Tata Steel has entered into a Strategic deal with Canadian Firm Labrador Iron Mines Holdings through its subsidiary Tata Steel Minerals Canada Ltd. ADAG Group Company, Reliance Big Entertainment has acquired a division of Funnel Japan, a Gaming Firm through its subsidiary Reliance Big Entertainment Japan Co. and has created Reliance Games Japan. Amtek Auto is planning to buy a German based company, Neumayer Tekfor Group, at a buy price of US$500 Mn.

Varroc Group has acquired 50% stake of Visteon Corporation's Chinese JV - Visteon TYC Auto Lamps Co., Ltd for around US$20 Mn.

Facor Alloys Limited through its overseas subsidiary Facor Minerals (Netherlands) B.V. has acquired a 51% stake in a Dutch Firm - Dillenburg Bergen NH Realty B.V. (DBR) for a consideration of $10 Mn.

February
TVS Logistics has acquired 85% stake in British Firm, Rico Logistics for R100 Cr. through the holding company - TVS Logistics, UK. Mahindra Satyam has acquired Brazil Firm-Complex IT, a SAP consultant for an undisclosed amount

January
Trivitron, a south India based medical equipment maker, has fully acquired its partner ETA Star Healthcare's stake in the Dubai JV. ETA Star, part of the Al Ghurarir Group. Hinduja Group has agreed to Buys Struggling European Media Firm Alfacam Micro Labs Close a deal to Buy Pharma Units In Egypt And Indonesia. Ador Welding has acquired 60% Stake in Israeli Firm Plasma Laser Technologies. InMobi has acquired British Tech Firm - Overlay Media for an undisclosed amount.

 Gujarat State Fertilizers & Chemicals has made a strategic investment by acquiring 19.98% stake in Karnalyte Resources Inc., Canada for C$ 45 Mn. OP Munjal led Hero Cycles is close to acquiring a manufacturing unit and a distribution business of two European cycle makers for an estimated value of around R500-550 Cr. R Jhunjhunwala Portfolio Firm Geometric Limited has acquired a German Company 3Cap Technologies GmBH. for Euro 11 Mn through its German subsidiary Geometric Europe GmbH Saksoft Limited acquired American Info Management Company Electronic Data Professionals(EDP) through its WOS Saksoft Inc. Godrej Consumer Unit Buys British Brand - Soft & Gentle

Thus, we continue to believe that with a fair degree of cautiousness, India Inc. is gaining the global edge and with this pace will be a global Icon in the years to come.

----------------------------------------------------------For more details on this report please contact: Shagun Madan Partner | INDEL Advisors LLP M: +91 9810481414 E: shagun@indelglobal.com Log on to: www.indelglobal.com 2013 INDEL Advisors LLP. All rights reserved.

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This report contains information in summary form and captures the list of deals announced based on information available in the public domain and public announcements and is therefore intended for general guidance only. It is not intended to be a substitute for detailed research or the exercise of professional judgment. Neither INDEL Advisors LLP nor any other member of the INDEL global can accept any responsibility for loss occasioned to any person acting or refraining from action as a result of any material in this report. On any specific matter, reference should be made to the appropriate advisor.
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