India is second highest in M&A deals in Asia

Mumbai: India has emerged as the second largest contributor to M&A deals in the Asia-Pacific region, accounting for 15 per cent of deals, behind Australia''s 28 per cent share.

India''s share in such transactions was only 6 per cent in 2005. This was revealed in a media presentation by SBI Capital Markets yesterday.

R Sridharan, managing director and chief executive officer, SBI Capital Markets said that the M&A deals in India were poised for buoyant growth due to a better regulatory environment, strong corporate performance and "overall positive micro-economic indicators".

Sridharan told the media that the $50 billion worth of M&A deals in the first half of 2007 had already exceeded the total value of such transactions in all of 2006.

Earnings from handling such deals now account for nearly 20 per cent of SBI Capital Markets'' revenues.

He said that the company had become a member of the leading global alliance for facilitating mid-sized deals, M&A International, which was helpful while handling cross-border transactions.

With Reserve Bank raising the limit for making overseas investment from 300 per cent of net worth to 400 per cent (See: RBI eases forex rules, doubles overseas investment limit to $200,000), the pace of overseas acquisitions was expected to grow, A P Verma, president, SBI Capital Markets said.

He added that RBI was still prescribing ceilings on overseas investment to ensure companies do not over leverage themselves during such transactions.