Adani, Ambani to drive M&A deals to diversify business
Business tycoons Mukesh Ambani and Gautam Ambani will continue with mergers and acquisitions (M&A) in India to fulfil their bid to diversify their businesses, Bloomberg said quoting a report by Barclays Plc.
In an interview with Bloomberg TV, Pramod Kumar, managing director and head of investment banking for India at Barclays, said that M&A trend was evident from the Adani and Reliance groups’ recent foray into newer areas.
“They do have capital backing them, so we will continue to see them spot opportunities in this environment,” he said.
According to Bloomberg, while Adani made a $10.5 billion deal for Holcim Ltd.’s Indian operations, while Reliance Industries is vying to take over the India operations of German retailer Metro AG.
Reliance Industries has also been eyeing the pharmacy retail business of Walgreens Boots Alliance, Inc. (WBA) and that of Apollo Global Management. It has been an unsuccessful dream after WBA revisited its decision to sell the division.
Reliance has already acquired companies like REC Solar while holding a 40 per cent stake in SWREL (earlier known as Sterling and Wilson Solar Ltd).
This apart, both the companies will be participating in the 5G spectrum action. It is being speculated that Adani, who entered the 5G race last week, may be eyeing to acquire Vodafone Idea to spread its ambit to the telecom sector.
Kumar says that more capital will be available to enable these companies to strike M&A deals. He also cautions that that acquisition and mergers may be slower than expected as investors at present are wary to invest due to the rising interest rates and falling value of Indian rupee.
“The overall deal momentum in the second half is certainly slowing down, that would impact the overall deal activity,” he added.