Law firms recorded 10% rise in M&A deals in January-March quarter

MUMBAI: Mumbai-based corporate law firm Desai & Diwanji remain the country's biggest law firm in terms of the number of M&A deals in the January-March quarter, while Amarchand & Mangaldas topped in terms of deal value, according to data on Mergermarkets.

Indian law firms recorded a 10% year-on-year rise in the value of merger and acquisition deals in January-March, led by domestic transactions as European economic crisis continued to weigh on cross-border deals. However, the number of deals during the quarter was down 21% from the same period a year ago.

In the first quarter of 2012, law firms advised more than 57 M&A deals worth $16.49 billion, which in value terms is 56% of the total value of transactions during the whole of 2011.

Some of the big ticket deals this quarter include the $10.28-billion merger of Vedanta Group's two subsidiaries Sesa Goa (SGL) and Sterlite Industries (SIIL) advised by Luthra & Luthra Law Offices and Amarchand & Mangaldas & Suresh A Shroff & Co (AM) and Piramal Healthcare's buy out of an additional 5.5% for $616 million in Vodafone India, which was advised by AM and AZB & Partners. "We continue to see robust activity," said Toral Desai, partner, Desai & Diwanji. "In terms of ongoing/ pipeline transactions, we are seeing activity in various sectors, including FMCG and financial services."

However, the data indicates that cross-border M&A remained sluggish, with inbound deals plummeting from $13.07 billion in the first three months of 2011 to $3.77 billion in the same period this calendar. Outbound mergers and acquisitions continued to weaken, with 15 deals worth $0.62 billion.

"Various factors have contributed to the decline such as crisis in Europe causing a paucity of funds available for inbound M&A deals, roll-back in certain regulatory reforms and an uncertain taxation regime," said Rajiv Luthra, founder of Luthra & Luthra Law Office.

The rise in M&A activities during the quarter comes on the back of $10.3 billion internal restructuring of Vedanta Resources.

"Sectors, such as financial services, life science, consumer and education, will see some small transactions in coming quarters," said Avinash Gupta, head - financial advisory at Deloitte. However, he said regulatory uncertainties will continue to weigh on the deal market.