Year 2006 will probably known as the year when Indian businesses & Indian businessmen emerged on the global map. India’s emergence in the global business arena has been driven mainly by acquisitions and mergers. In January 2006, Lakshmi Mittal CEO of Mittal Steel launched a hostile takeover bid for Arcelor - which was completed by July 2006. On similar lines, Tata Steel went abroad with acquisition of NatSteel in Singapore and Corus Steel in the UK.
Notable cross-border acquisitions
Some of the Notable cross-border acquisitions in the year 2006 are:
1. Videocon Industries buying Daewoo Electronics - $731 Million
2. Dr Reddy Labs acquires Betapharm Arzneimittel - $572 Million
3. Ballarpur Industries buys Sabah Forest Industries - $261 Million
4. Ranbaxy Labs acquisition of Terapia - $324 Million
5. Suzlon Energy buys Hansen Transmission - $565 Million
In total, Indian firms spent $15.72 billion in 192 overseas acquisitions. While this number may not be significant when compared on a global scale, this number is significant in the global context. The real significance of this should be seen from the fact that next year this number could double or even triple, making India as Asia’s largest acquirer abroad.
India Plays with Global Expansion
Indian companies are using all the tricks of the trade to go global: Mergers & Acquisitions, Organic expansions, Green field investments, and Joint Ventures. The scale and the business share may not be significant today, but Indian businesses are slowly but surely establishing themselves abroad.
Tata Motor’s successful acquisition of Daewoo’s truck unit in 2002 in S. Korea has become a classic business case study. Tata acquired a loss making unit - and without any layoffs, turned the loss making unit around. This built enormous goodwill and reputation for Indian companies in S. Korea. This helped Videocon acquire Daewoo Electronics and is aiming to acquire LG-Philips... [continues]
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