India M&A Trend Report: 2013

Overview

M&A targeting India totalled US$ 20.8bn in 2013, 46.3% off the 2012s
value (US$ 38.7bn). Volumes too, witnessed a slight slump, with the 267
deals this year, 13 fewer than in 2012

The final quarter of 2013 saw an aggregate US$ 3.4bn-worth of deals,
40.4% below the US$ 5.7bn posted in Q3 2013. A mere 50 deals were
announced in Q4 2013, the lowest number since Q1 2009 (39 deals)

Unilevers US$ 3.5bn acquisition of a 14.8% stake in Hindustan Unilever
in April remains the largest deal in India this year and accounted for
16.8% of aggregate M&A value in the country

The Pharma, Medical & Biotech experienced transactions amounting to
US$ 4.2bn, making it the only sector to post a second successive increase
in annual M&A value or volume

Inbound M&A slid for the second year to US$ 14.3bn, a 19.7% decline
from 2012 (US$ 17.8bn). The number of deals involving overseas
acquirers however shot to a record high (since 2001) of 147. It appears
that smaller targets are being snapped up by foreign buyers while larger
deals are being stymied by concerns associated with the outcome of
next years general elections

Tighter access to credit is expected to result in several potential buying
opportunities. The Reserve Bank of Indias attempts to facilitate buyouts
of distressed companies may provide a fillip for private equity activity,
although onerous valuation restrictions announced this week will ensure
persistent uncertainty in this regard

Outbound bids in 2013 totalled US$ 7.7bn, a 22.2% increase from 2012
(US$ 6.3bn) largely due to two acquisitions worth US$ 5.1bn by state-run
ONGC and Oil India off the coast of Mozambique. The number of deals in
contrast, fell from 76 to 40 during the corresponding period

M&A Trend: India





Industry Analysis


Sector
2013 2012 Change
Value ($m)
Mrk
share
Deal
count
Value ($m)
Mrk
share
Deal count Value (%)
Deal
count
Pharma, Medical & Biotech 4,169.8 20.1% 38 1,446.1 3.7% 30 188.4% 8
Construction 4,104.6 19.7% 16 670.7 1.7% 16 512.0% 0
Consumer 4,025.2 19.4% 24 6,760.3 17.5% 28 -40.5% -4
Industrials & Chemicals 2,356.8 11.3% 64 3,518.6 9.1% 67 -33% -3
Telecommunications 1,900.5 9.1% 7 791.8 2% 2 140.0% 5
Business Services 1,003.2 4.8% 32 4,308.6 11.1% 33 -76.7% -1
Energy, Mining & Utilities 1,001.7 4.8% 14 11,618.0 30% 16 -91.4% -2
Financial Services 784.1 3.8% 20 1,603.8 4.1% 18 -51.1% 2
Technology 769.4 3.7% 22 423.7 1.1% 14 81.6% 8
Transport 468.4 2.3% 7 4,782.5 12.4% 9 -90.2% -2
Media 166.3 0.8% 12 1,950.8 5% 18 -91.5% -6
Leisure 34.2 0.2% 4 549.8 1.4% 14 -93.8% -10
Agriculture 10 0.0% 3 149.9 0.4% 9 -93.3% -6
Defence - - - 13.8 0.0% 2 -100.0% -2
Real Estate - - 4 98.1 0.3% 4 -100.0% 0
Total 20,794.2 267 38,686.6 280 -46.2% -13


Cross-border analysis



Deal size analysis


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2007 2008 2009 2010 2011 2012 2013
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2007 2008 2009 2010 2011 2012 2013
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Inbound Value Outbound Value
Inbound Volume Outbound Volume
7.0
8.6
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7.9 10.3
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0 5 10 15 20 25 30 35 40 45
2013
2012
2011
Value of Deals ($bn)
0m - 250m 251m - 500m 501m - 2,000m 2,001m - 5,000m > 5,001m
Citi displaced Morgan Stanley atop the Financial
Advisor League Table by value with seven deals
totalling US$ 9.3bn - three of which were among the
five largest deals so far this year. Ernst and Young
retained its position as the most active Financial
Advisor by deal count with 21 mandates

Amarchand & Mangaldas & Suresh A Shroff &
Co led the Legal Advisor League Tables by value
after advising on 38 deals worth US$ 10.1bn. AZB &
Partners secured 45 mandates to pip its nemesis
and round off 2013 as the most active legal advisor
by volume

India M&A Trend Report: 2013

Spotlight on Pharma, Medical & Biotech (PMB) M&A

Overview

Pharma, Medical & Biotech (PMB) dealmaking hit US$ 4.2bn (38 deals), a
staggering 188.4% increase from 2012 (US$ 1.4bn, 30 deals) with eight more
deal announcements. This represents a second consecutive annual rise by
both value and volume

The rest of the Asia-Pacific region too witnessed an increase in PMB M&A,
rising 12.1% from US$ 11.5bn in 2012 to US$ 14.4bn (163 deals). China and
Hong Kong were stellar performers, recording four successive years of
growth in deal values to US$ 6.8bn and US$ 1.3bn respectively

Private equity buyers acquired 19 firms in transactions totalling US$ 0.7bn in
2013, representing the most deals and the highest value on Mergermarket
record (since 2001) for this activity

Exits too saw the most targets sold for the highest value on Mergermarket
record. Deal value soared 383.9% from 2012 (US$ 0.1bn) to US$ 0.5bn in
2013 with seven deals, three more than the previous peak of four in 2010

Mylans US$ 1.6bn purchase of Agila Specialties marked the largest
transaction in the PMB space this year. GlaxoSmithKline Plc dished out US$
1bn to increase its stake in GlaxoSmithKline Pharmaceuticals Ltd to the
maximum permissible 75%, a trend slated to continue among MNCs in the
country




Pharma, Medical & Biotech trend

Asian Target
Country
2013 2012 2011
Value
($m)
Deal
Count
Value
($m)
Deal
Count
Value
($m)
Deal
Count
China 6,816 81 6,061 67 3,611 51
Japan 1,960 24 416 24 2,051 19
Australia 1,787 28 2,081 21 2,112 23
Hong Kong 1,333 7 408 3 213 3
South Korea 951 19 1,327 13 1,143 13
Singapore 918 6 630 6 1,028 6
Taiwan 246 4 60 1 1
Indonesia 226 3 1
Vietnam 119 2 8 2 78 2
Malaysia 35 2 300 3 1,302 7
New Zealand 32 5 87 3 58 4
Thailand 14 2 100 1 116 1
Bangladesh 10 1
Kazakhstan 67 1
Pakistan
Philippines 1 6 1 41 2
Sri Lanka 32 1
Total 14,437 184 11,515 147 11,832 134


India PMB buyouts and exits analysis





Pharma, Medical & Biotech projections

Both primary and secondary private equity buyouts are expected to increase
in 2013. Companies in the PMB space are seeking capital for expansion, which
should provide an ideal window of opportunity for private equity firms as
other exit options such as a strategic sale and IPOs are expected to remain
slow until the outcome of the 2014 general elections

An impasse between different government ministries regarding restrictions
on FDI in generic drug makers resulted in diminished strategic investor
interest. We expect foreign acquirers to remain wary of acquiring Indian
targets in spite of the governments decision to retain the 100% FDI limit until
after the general elections

Indian pharmaceutical giants Cipla and Sun Pharmaceutical Industries are
known suitors and have reportedly been eyeing generic drug manufacturers
in Japan, Europe and the US. High interest rates and difficulties in raising
funds for deals will however continue to pose problems for Indian firms on
the acquisition warpath



Top Pharma, Medical & Biotech deals involving Indian targets
Ann. Date Bidder company Target company Seller company Bidder advisors Target/Seller advisors
Deal Value
(US$m)
27-Feb-13 Mylan Inc Agila Specialties Private
Limited; and Agila
Specialties Asia Pte Limited
Strides Arcolab Limited FA: Morgan Stanley


LA: Barbosa, Mussnich & Aragao;
Morgan Lewis & Bockius; Osler,
Hoskin & Harcourt; Platinum
Partners; Skadden Arps Slate
Meagher & Flom; Slaughter and
May

FA: Jefferies; Moelis &
Company

LA: Borden Ladner Gervais;
DSK Legal; Haynes and
Boone; Herbert Smith
Freehills; Jones Day;
Pinheiro Neto Advogados
1,600
16-Dec-13 GlaxoSmithKline Plc GlaxoSmithKline
Pharmaceuticals Ltd
(24.3% Stake)
FA: HSBC

LA: Slaughter & May
FA: -

LA: -
1,035
13-Dec-13 Torrent Pharmaceuticals Ltd Elder Pharmaceuticals
Limited (Branded Domestic
Formulation Business)
Elder Pharmaceuticals
Limited
FA: Deloitte

LA: -
FA: Nomura Holdings

LA: Khaitan & Co
323
23-Nov-13 Pfizer Ltd Wyeth Ltd FA: Bank of America Merrill
Lynch
LA: AZB & Partners
FA: Citi

LA: Advising FA: Davis Polk
& Wardwell

294
27-Nov-13 Kohlberg Kravis Roberts &
Co LP
Gland Pharma Limited Evolvence India Life
Sciences Fund
FA: Citi

LA: Amarchand & Mangaldas &
Suresh A Shroff & Co; Simpson
Thacher & Bartlett

FA: -

LA: AZB & Partners
200
0
10
20
30
40
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2010 2011 2012 2013
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Exits Value
No. of Buyouts
No. of Exits
India M&A Trend Report: 2013

Top Deals
Ann. Date Bidder company Target Company Seller company Buy-side Advisory Sell-side Advisory Deal Value ($m)
30-Apr-13 Unilever NV Hindustan Unilever Limited
(14.8% Stake)
FA: HSBC; UBS Investment Bank

LA: Linklaters; Talwar Thakore &
Associates
FA: Citi

LA: Advising FA: Davis Polk
& Wardwell
3,549
25-Aug-13 ONGC Videsh Limited Rovuma Offshore Area 1
Block (10% Stake)
Anadarko Petroleum
Corporation
FA: Bank of America Merrill
Lynch

LA: Simmons & Simmons
FA: Citi


LA: -
2,640
25-Jun-13 ONGC Videsh Limited; and
Oil India Limited
Rovuma Offshore Area 1
Block (10% Stake)
Videocon Mauritius Energy
Limited
FA: Bank of America Merrill
Lynch; Morgan Stanley


LA: Kochhar & Co; PLMJ -
Sociedade de Advogados;
Simmons & Simmons
FA: Credit Suisse; Standard
Chartered; UBS Investment
Bank

LA: Amarchand &
Mangaldas & Suresh A
Shroff & Co
2,475
24-Jul-13 Ambuja Cements Limited ACC Limited (50.01% Stake) Holcim Ltd FA: Axis Capital

LA: Amarchand & Mangaldas &
Suresh A Shroff & Co
FA: Citi

LA: Homburger
2,433
27-Feb-13 Mylan Inc Agila Specialties Private
Limited; and Agila
Specialties Asia Pte Limited
Strides Arcolab Limited FA: Morgan Stanley


LA: Barbosa, Mussnich & Aragao;
Morgan Lewis & Bockius; Osler,
Hoskin & Harcourt; Platinum
Partners; Skadden Arps Slate
Meagher & Flom; Slaughter and
May

FA: Jefferies; Moelis &
Company

LA: Borden Ladner Gervais;
DSK Legal; Haynes and
Boone; Herbert Smith
Freehills; Jones Day;
Pinheiro Neto Advogados
1,600


League Tables to M&A Activity Involving India


Financial advisor league table by value 2013


Legal advisor league table by value 2013

Rank
2012 2013
House Value ($m)
Deal
count

% Value change

2 1 Citi 9,277 7 -49.7%
9 2 UBS Investment Bank 6,024 2 57.3%
3 3 Bank of America Merrill Lynch 5,327 5 -61%
16 4 HSBC 4,993 4 234%
1 5 Morgan Stanley 4,168 8 -79.5%
10 6 Standard Chartered 3,762 4 12.2%
11 7 Axis Capital 3,508 9 20.1%
5 8 Credit Suisse 3,240 3 -69.3%
- 9 Moelis & Company 2,129 3 -
6 10 Goldman Sachs 2,056 5 -79.7%
32 11 Jefferies 1,600 1 306.1%
15 12 Barclays 1,551 5 -0.5%
12 13 Kotak Investment Banking 1,072 10 -52.6%
13 14 Rothschild 1,062 8 -43.3%
- 15 Macquarie Group 1,043 3 -
Rank
2012 2013
House Value ($m)
Deal
count

% Value change

1 1
Amarchand & Mangaldas &
Suresh A Shroff & Co 10,149 38 -51.2%
25 2 Simmons & Simmons 5,115 2 411.5%
16 3 Jones Day 4,009 4 248.3%
46 4 Davis Polk & Wardwell 3,886 4 1,070.5%
39 5 Linklaters 3,648 3 825.9%
134 6 Talwar Thakore & Associates 3,601 5 -
7 7 Slaughter and May 3,350 5 -31.4%
89 8 White & Case 3,333 5 9,158.3%
6 9 AZB & Partners 3,305 45 -36.4%
- 10
PLMJ - Sociedade de
Advogados 2,475 1 -
122 11 Bowman Gilfillan Africa Group 2,436 2 -
- 12 Homburger 2,433 1 -
- 13= CMS 2,331 1 -
- 13= Sullivan & Cromwell 2,331 1 -
10 15 Khaitan & Co 2,246 27 -37.5%
Financial advisor league table by deal count 2013


Legal advisor league table by deal count 2013


Rank
2012 2013
House Value ($m)
Deal
count

Count change

1 1 EY 534 21 4
19 2 PwC 656 11 6
7 3 Kotak Investment Banking 1,072 10 0
11 4 ICICI Securities 809 10 1
2 5 KPMG 555 10 -2
3 6 BMR Advisors 208 10 -1
13 7 Axis Capital 3,508 9 1
5 8 Morgan Stanley 4,168 8 -2
17 9 Rothschild 1,062 8 3
65 10 o3 Capital Advisors 99 8 7
9 11 Citi 9,277 7 -2
62 12 Translink 84 6 5
28 13 Bank of America Merrill Lynch 5,327 5 3
16 14 Goldman Sachs 2,056 5 0
20 15 Barclays 1,551 5 1
Rank
2012 2013
House Value ($m)
Deal
count

Count change

4 1 AZB & Partners 3,305 45 15
1 2
Amarchand & Mangaldas &
Suresh A Shroff & Co 10,149 38 -6
3 3 Khaitan & Co 2,246 27 -10
2 4 Desai & Diwanji 617 24 -16
5 5 Trilegal 697 22 2
7 6 J Sagar Associates 693 17 2
19 7 DLA Piper 1,573 13 8
9 8 Tatva Legal 219 13 2
10 9 Nishith Desai Associates 115 8 -2
11 10 Rajani, Singhania & Partners 298 7 -3
6 11 DSK Legal 1,674 6 -11
26 12 Vaish Associates 627 6 2
16 13 Luthra & Luthra Law Offices 325 6 1
134 14 Talwar Thakore & Associates 3,601 5 4
28 15 Slaughter and May 3,350 5 2








India M&A Trend Report: 2013


Notes

All data is based on announced transactions over US$ 5m. Deals with undisclosed deal values are included where the targets turnover exceeds
US$ 10m. Deals where the stake acquired is less than 10% will only be included if their value is greater than US$ 100m. Activities excluded include
property transactions and restructurings where the ultimate shareholders interests are not changed. All data excludes minority stake deals (10% -
30%) where the dominant target geography is Asia-Pacific and the deal value is less than US$ 100m

M&A Trend: Based on the dominant geography of the target company being India. Excludes lapsed and withdrawn bids

Cross-border M&A: Inbound refers to cross-border M&A where the dominant geography of the target company is India. Outbound refers
to cross-border M&A where the dominant geography of the bidder company is India. Excludes lapsed and withdrawn bids

Top Announced Deals: Based on the dominant geography of the target, bidder or seller company being India. Excludes lapsed and
withdrawn bids. FA refers to Financial Advisor and LA refers to Legal Advisor

Industry Analysis: Based on the dominant geography of the target company being India. Industry sectors represent the primary industry
sector of the target company only. Excludes lapsed and withdrawn bids. The Buyout Sector breakdown includes Other which refers to
Business Services, Leisure, Agriculture, Defence and Real Estate and. The Exit sector breakdown includes Other which refers to. Buyout
and Exit sector breakdown include TMT which refers to Technology, Media & Telecommunications

League Tables for Total India M&A: Based on the dominant geography of the target, bidder or seller company being India. The Financial
Advisor tables exclude lapsed and withdrawn bids, and the legal advisor tables include lapsed and withdrawn bids

League Tables for Indian M&A Advisors: Based on the dominant geography of the target, bidder or seller company being India and the
advisor being an entity which is headquartered in India. The Financial Advisor tables exclude lapsed and withdrawn bids, and the legal
advisor tables include lapsed and withdrawn bids

All values are in US$

All data correct as of 09 January 2014

Criteria


PR contacts
Europe Flora Wilke +44 207 010 6438
Americas Chrissy Carney +1 646 378 3118
Asia Flora Wilke +44 207 010 6438


Commercial contacts
Europe Ben Rumble +44 207 010 6100
Americas Lauren Peterson +1 212 500 7537
Asia
Ajay Narang
+852 2158 9764


Research contacts
Editor Kirsty Wilson +44 207 010 6271
Analyst Raza Hussain +852 2158 9726




Deal submission contacts
Europe EMEA
Nancy Honsinger

CEE
Zaynab Dost

+44 207 010 6227


+44 207 010 6129

Americas Raquel Mozzer +1 212 574 7866

Asia Asia-Pacific
Miran Lim

Japan
Sophie Kim

+852 2158 9709


+81 3 3597 2055