As companies compete to win in India, expect more large-scale M&A
According to “boutique” advisory firm Raine Group LLC, the rapid rise of India’s tech sector will see “more billion-dollar acquisitions” as foreign internet companies jostle for dominance. The advisory firm sees a spate of activity in the last few years, which has seen massive figures like Amazon, Alibaba, Walmart, and Berkshire Hathaway enter the fray, as just the beginning.
SSource: Internet and Mobile Association of India, Cisco
According to Raine’s Indian chief, Mumbai-based Gaurav Mehta, deal will be particularly forthcoming in the ecommerce, financial technology and emerging media sectors. He should know – he advised on the two biggest tech deals in the country so far this year.
Mehta also says that companies are seeing the logic of consolidation – despite the country’s impressive growth. This rational approach to M&A, he adds, is nowhere near burning out: “The largest companies in the world are playing a very active role in how the sector landscape evolves in India. M&A driven by more strategic, long-term factors is seeing record activity.”
India is a massive part of the picture when it comes to Big Tech’s plans for further growth. Like China, it’s an incredibly populous country. But unlike China, it doesn’t have an aging population, meaning it will outpace its emerging world partner in terms of population growth sometime within the next decade or two. India is also a friendlier market for outsiders, who don’t have to contend with China’s infamous “great firewall” and stringent censorship laws in order to do business.
Mehta explains: “For a number of years, global strategics sat on the sidelines. The realization is setting in that India is too strategic a market to be underweight.”
Dominion holds a number of companies in its Global Trends Ecommerce Fund that are involved in the Indian internet boom.
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