Five M&As that Whirred Dalal Street

On 16th August 2016, that is yesterday, Dalal Street witnessed a magnificent event that buzzed the entire market. Ranging from Auto to Pharma sector, five mergers and acquisitions deals were cut clearly indicating the strong investor optimism returning to the streets.

Piramal Buys Ash:

Yesterday, Piramal Enterprises bought Ash Stevens INC. in an all cash deal of Rs. 286 crores, going ahead with its plans of expansion in the North American Business. Additionally, Piramal enterprises will pay the earn-out capped at Rs. 67 crores. It is a payment that depends on the business achieving a certain financial goals. Ash Stevens INC was a US based contract developer and manufacturer of drugs. The purchase is made by the US unit of Piramal Enterprises and is expected to be concluded by August end. Ash Stevens INC. has 50 years of experience in the sector and has been the leader in the manufacturing of high pot

JSW Steel acquires JSW Praxair:

On 16th August 2016, JSW Steel agreed to buy out Braxair India’s entire stake of 74% in their joint venture of JSW Praxair Oxygen. JSW steel will be buying out the stakes for Rs. 240 crores. The deal will make the industrial gases supplier a wholly owned subsidiary of JSW Steel. The company announced in a filling that the deal is strategic as it will provide the company the benefit of backward integration.

Tata Auto Comp acquires TitanX:

Declaring that the engine cooling supplier TitanX to be the perfect fit in the future growth areas, Tata AutoComp went ahead with its acquisition of the company. Owing to the customary regulatory approvals, the deal might be accomplished by the end of 2016. TitanX has plants across North and South America, Europe, and China with approximately 200 million USD sales. The company is currently owned by EQT Opportunity and Fourier transform. The acquisition is a vital part of the company’s plans of Global Expansion. ency active pharma ingredients. The buyout is bound to benefit Piramal in more than one ways.

Unilever acquires Blueair:

Blueair, the mobile air purification technology leader has been acquired by Unilever for the undisclosed sum. The acquisition is taking the company into the arena that complements its water purification segment. Blueair has the 20 years of experience in the revolution of bringing clean air. The founder of the company stated that the acquisition will help their cause by widening the reach of Blueair purifiers.

Grasim merges with Aditya Birla Nuvo:

The Indian Billionaire, Kumar Mangalam Birla unveiled his plans on merging Grasim and Aditya Birla Nuvo. The merger will be followed by a planned spinoff of Aditya Birla Financial Services Ltd. The entire power packed plans will help the non-banking unit to expand. Financial services sectors are the next target market of Birla for the growth. Apart from Rs. 60 billion from the parent company, the financial services unit will require more funds for the new technologies and accelerating economic boost. After the brokerages like HSBC Holdings and IDFC securities flagged down their recommendations on Grasim, the company is trying to clarify their investors on the rationale of the merger. The brokerages denied the recommendations saying that the amalgamation would leave the pooled entity with non-core businesses.

Crazy or not, the mergers and acquisition have impacted the stocks of the companies along with the entities themselves. Mergers and acquisitions in 2015 have been perfunctory, while the numbers have skyrocketed in 2016. The first half of the year witnessed 750 deals worth $21.8 billion as compared to 738 deals worth $ 21.1 billion in the first half of 2015. Most of the deals yesterday were done with the plans of expanding product portfolio in new geographies.

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