Q1 M&A deal down 23%

The merger and acquisition value in the first quarter of 2014 declined by a significant 23 per cent to USD 4 billion over the corresponding period a year ago, a Grant Thornton report said.

In the first three months of 2014, M&A deals worth USD 4.07 billion took place, while the value in the same period in the previous year was USD 5.3 billion. The number of merger and acquisition (M&A) deals was 128 against 131 transactions in the comparable period, according to the latest issue of Grant Thornton Deal Tracker.

“M&A deal value has declined by 23 per cent in Q1/14 over Q1/13, which possibly reflects the wait and watch stance of corporates given the general elections, which brings in own share of uncertainty,” Grant Thornton Partner Raja Lahiri said.

External pressures and political situation have impacted deal values which clearly mean that growth in value will need better economic scenario and more particularly a better capital and debt market support, which has been missing, Harish H V, Partner, Grant Thornton, said.

The top sector in M&A, in terms of value, was the energy & natural resources segment, which accounted for 20 per cent (USD 798 million) of overall deal activity. In terms of volumes, IT & ITES saw 25 deals (out of 128).

“The deal activity has been vibrant across the sector driven both by domestic consolidation and private equity investment,” Grant Thornton India Partner Siddhartha Nigam said.