Mergers & acquisitions expected in ports: Ernst & Young
The next set of merger and acquisitions are expected in the Indian port sector despite the recent rise in cost of purchasing terminals, according to a study.
By PTI |
MUMBAI: The next set of merger and acquisitions are expected in the Indian port sector despite the recent rise in cost of purchasing terminals, according to a study.
"Ports are increasingly attracting the interest of investors. The merger and acquisitions trend in port have hit India, too," Ernst and Young said in a study.
One of the main reasons why there would be an increase in M&A activities in this sector is that investors feel that port offers a steady source of income, it found.
Financial investors, especially with a long-term horizon, like port assets because these assets tend to generate steady cash flows and high margins.
"Mature ports such as Hong Kong, Singapore or Los Angeles provide a steady income stream while ports in the emerging markets of China, India and Eastern Europe have strong potential for growth," it pointed out.
The investors, who are expected to invest in ports, are banks, private equity funds and pension funds.
"Ports are increasingly attracting the interest of investors. The merger and acquisitions trend in port have hit India, too," Ernst and Young said in a study.
One of the main reasons why there would be an increase in M&A activities in this sector is that investors feel that port offers a steady source of income, it found.
Financial investors, especially with a long-term horizon, like port assets because these assets tend to generate steady cash flows and high margins.
"Mature ports such as Hong Kong, Singapore or Los Angeles provide a steady income stream while ports in the emerging markets of China, India and Eastern Europe have strong potential for growth," it pointed out.
The investors, who are expected to invest in ports, are banks, private equity funds and pension funds.
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