M&A deals inch up 2.8% to $5.2 billion in Q1

MUMBAI: The M&A street remained lacklustre in the first quarter of this year with the merger and acquisition deals involving domestic companies inching up to $ 5.2 billion, says a report.

The underlying amount in the deals increased 2.8 per cent to $ 5.2 billion during Q1, 2014 but declined 27.4 per cent compared to the October-December quarter, according to the data company Thomson Reuters.

Going by the number of deals, M&As declined 29.5 per cent to 232 from 329 in the year-ago period, it said. As a result, the average size of a deal jumped to $ 56.3 million from $ 34 million as more deals of over $ 500 million value were announced.

However, the deal activity between local companies/fund houses more than doubled to $ 2.7 billion during the January -March quarter, helped by a surge in the energy and power space, the report said.

This segment captured 71.3 per cent of the deal activity, followed by telecom, media and technology space with 7.7 per cent at $ 398 million, up 52.1 per cent during the first quarter, it said.

On cross-border front, the deal activity fell 38.7 per cent to $ 1.9 billion in Q1, with inbound deals falling 49.4 per cent and outbound deals jumping 57.2 per cent, it said without giving the absolute amounts.

Giving the break-up of the deal flow, the report said the foreign firms' acquisitions into domestic companies or the inbound M&A into the country dipped 49.4 per cent to $ 1.4 billion, with Singapore leading the way with 9 deals collectively worth $ 371.4 million, it said.

On the outbound front, there was a 57.2 per cent increase to $ 497.6 million, with Mauritius attracting the most funds at 67.6 per cent.

The total fees earned by the merchant bankers stood at $ 49.8 million, up by 51 per cent as compared to the same period last year, according to the report.

Bank of America Merill Lynch led the merchant bankers on the advisory fee earnings front, accounting for 31.9 per cent of the market share with $ 15.9 million in deals.