Indian firms acquire 143 U.S. companies in 2 years

By siliconindia   |   Friday, 19 June 2009, 21:49 IST   |    46 Comments
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Indian firms acquire 143 U.S. companies in 2 years
Bangalore: In last two years Indian companies have acquired 143 U.S firms across different sectors, according to a survey conducted by Indian industry association FICCI and Ernst & Young. In 2007-08, 94 deals were concluded while in the next year Indian companies acquired 50 U.S firms. Tata Chemicals, Wipro, Reliance Communications and Firstsource Solutions were some of the Indian companies that bailed out U.S. companies which were on the verge of Bankruptcy and also saved thousands of jobs. The report also stated that IT&ITeS, manufacturing and pharmaceuticals were the main sectors where these acquisitions took place. The boom in Indian economy in last three to four years made few domestic companies rich thus giving them access to more capital. The deals were mostly based on debt finance with cash being a popular mode of payment. "This trend probably extends from India Inc's traditional preference for cash transactions in the domestic merger and acquisition space," the report observed. Indian government and RBI have made few liberal policies which has helped Indian companies in overseas investments. According to RBI data, in 2007-08 the total outbound investments of Indian companies amounted to $18 billion. In the first half of 2008-09, at least 2,000 proposals valued at $9 billion were cleared for overseas investments in joint ventures and wholly owned subsidiaries.