More Indian Business Leaders Keen on Foreign Deals, Says Survey

Over 55 per cent of Indian business leaders are more inclined towards making overseas business deals in the coming 12 months as compared to the past year, according to a survey. While only 11 per cent of the business leaders showed less interest in making overseas business deals, around 33 per cent of them retained the same level of interest as last year.

The Doing Business Globally survey, conducted by U.S.-based multinational law firm Baker McKenzie, said that 42 per cent Indian businesses are mainly seeking mergers and acquisition opportunities domestically. However, a quarter of respondents of the survey stated that their top target is the wider Asia Pacific region, with 16 per cent looking at North America.

“This is something of a shift, as North America has until recently been a firm favorite for Indian companies looking to buy abroad, less so Asia Pacific,” the survey said, IANS reported.

“While this positivity around global deal-making is great to see, it is particularly encouraging that India’s ambitions are also shifting a little closer to home,” Baker McKenzie Asia Pacific chair Gary Seib was quoted as saying by the news agency.

More than 200 top Indian business people were assessed on their opinions regarding deal-making at events held by the company in Mumbai and Bengaluru recently. They were also asked whether technology had an impact on the decisions they made.

Technology was found to be a key driver of M&A deals abroad, with 38 per cent of Indian companies saying that acquiring new technology and expertise was their top reason for engaging in cross-border M&A, the survey said.

Seib added that although Indian corporates have traditionally looked to the United States and Europe for M&A opportunities, which included buying high status brands and industrial and financial companies, “many now also see the value on offer in Asia Pacific, particularly as different markets incubate their own technologies, and supply chains across the region can be readily built.”

India is home to some of the world’s most exciting startups that center on robotics, the survey pointed out. And as cryptocurrencies are rising in the era of cashless economies, these developments in the digital arena now demand due diligence, right valuations, strong cybersecurity measures and regulatory structures, and responsible engagement.

“As global organizations adapt to the digital age, Indian companies are embracing an innovative mindset that will help them thrive in a borderless world,” Baker McKenzie said in a statement.

While assessing recent initial public offering (IPO) trends among Indian companies, Baker McKenzie announced transactions that would probably close in 2018, to provide a extensive picture of India’s IPO market. “In fact, capital raised YTD (year-to-date) in 2018 is almost 400 per cent the amount raised in the same period in 2017. By mid-April last year, there were only 40 IPOs that raised $619 million, compared with more than $3 billion raised through 71 listings in 2018 so far,” it said.

“There is a strong sentiment among the Indian clients we speak to that while reforms have taken time and there have been a few other hiccups, the business community is quite bullish on the direction of India,” Ashok Lalwani, global head of Baker McKenzie’s India Practice, was quoted as saying in the report.