Mergers and acquisitions (M&A) deals in the first nine months of the year surged by 66 per cent in value terms compared to the same period in 2023, signalling a revival in deal sentiment, according to a report by Boston Consulting Group.
However, deal volumes in India saw a marginal decline of 3 per cent, though this was not as sharp as the 13 per cent decline observed in the Asia-Pacific region and globally.
In the 21st edition of the Global M&A Report, the consulting firm noted that global deal value in the first nine months of 2024 increased by 10 per cent compared to the same period last year, reaching USD 1.6 trillion.The report highlighted that M&A activity in India has been strong in 2024, bucking the trend seen in other Asia-Pacific markets.
This performance marks a reversal of the sharp decline in deal-making that India experienced from mid-2022 through 2023.”While the global M&A market is on the road to recovery with a modest 10 per cent increase in deal value this year, India is outpacing the global trend, showcasing a remarkable 66 per cent surge in M&A activity in 2024.
This growth contrasts sharply with the broader Asia-Pacific market, which saw a 5 per cent decline, underscoring India’s unique resilience and appeal. Key drivers of large deals have been sectors such as technology, media, industrials, and healthcare, leveraging the ‘Make in India’ initiative, India’s strengthening ties with the US and Europe, and ongoing regulatory tensions between China and the West.
“Sector-wise, technology, media, and telecommunications accounted for 40 per cent of total deal value in the first nine months of 2024. Despite cautious global sentiment, industrial companies continue to lead deal-making in India this year.Healthcare targets also remain a significant focus, primarily driven by domestic deals as companies strive to maintain their leadership positions.”
As we look ahead, the longer-term outlook for deal-making in India remains strong. Companies with healthy balance sheets will continue to seek inorganic growth opportunities, while private equity and venture capital investors will aim to deploy record-high dry powder, as India continues to be a preferred investment destination,” said Dhruv Shah, Managing Director and Partner at BCG.
The report also highlighted that increased regulatory scrutiny and protectionist measures in some countries are impacting deal-making. Globally, the time from signing to closing for deals exceeding USD 2 billion increased by 11 per cent from 2018 to 2022, reaching an average of 191 days.
BCG’s analysis found that approximately 40 per cent of deals studied failed to close within the originally projected timeline. Nearly two-thirds of these delayed deals required an additional three months or more to close.
