M&A deals likely to slip next year: E&Y
14 May 2012 2:26 AM GMT
Against the backdrop of sluggish economic growth denting overall business confidence, merger and acquisition activities involving Indian companies are likely to slowdown in the next 12 months, says a survey.
The survey of senior executives representing large organisations was conducted by global consultancy Ernst & Young along with research group Economist Intelligence Unit.
As per the findings, companies are more focused on making investments for organic growth and there is likely to be a 'decline in interest in pursuing acquisitions in the next 12 months'.
Just about 36 per cent of the respondents indicated that they might pursue acquisitions in the next 12 months.
About 111 senior executives from India participated in the survey.
‘Reduced confidence in business environment has resulted in a conservative outlook for M&A among businesses,’ E&Y India Partner and national director (transaction advisory services) Ranjan Biswas said.
In terms of M&A destinations for Indian entities, the US and the UK top the chart. Other preferred nations are South Africa, China and the Philippines.
Meanwhile, 52 per cent of the respondents felt that domestic economy was improving while only 36 per cent participants echoed the same sentiment for the global economy.
‘The majority of the respondents (70 per cent) feel that the euro-zone crisis poses significant challenges to their operations. Around 45 per cent of those impacted view revenue and margin pressures to be the most significant fallout of the crisis,’ the report said.
The survey of senior executives representing large organisations was conducted by global consultancy Ernst & Young along with research group Economist Intelligence Unit.
As per the findings, companies are more focused on making investments for organic growth and there is likely to be a 'decline in interest in pursuing acquisitions in the next 12 months'.
Just about 36 per cent of the respondents indicated that they might pursue acquisitions in the next 12 months.
About 111 senior executives from India participated in the survey.
‘Reduced confidence in business environment has resulted in a conservative outlook for M&A among businesses,’ E&Y India Partner and national director (transaction advisory services) Ranjan Biswas said.
In terms of M&A destinations for Indian entities, the US and the UK top the chart. Other preferred nations are South Africa, China and the Philippines.
Meanwhile, 52 per cent of the respondents felt that domestic economy was improving while only 36 per cent participants echoed the same sentiment for the global economy.
‘The majority of the respondents (70 per cent) feel that the euro-zone crisis poses significant challenges to their operations. Around 45 per cent of those impacted view revenue and margin pressures to be the most significant fallout of the crisis,’ the report said.
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