In the past decade, Mergers and Acquisitions have taken over the corporate sphere globally and in that India is not far behind achieving greater mobilization of economy, especially after the removal of constructive arrangements and liberalisation of the Indian economy. 

Mergers and acquisitions are those strategic tools which help in the development of the economy of any nation. It enables expansion to either low cost markets or emerging markets, especially those which have a high number of skilled workers, else by acquiring well established corporate entities. Though,M&A culture has been prevalent in India since 2015 but has significantly increased and became the talk of the town in recent years.

It is pertinent to note that since 2010 because of the liberalisation in the economy, there has been a considerable increase in M&A deals in India welcoming multinational companies (MNCs) with the help of Joint ventures or Acquisitions. 

This has created a competing environment between local and foreign firms greatly over the past few years. In 2018, nearly 70% of the M&A activity included distressed deals. 

This was mainly enabled because of the Corporate Insolvency Resolution Process (CIRP) under the Insolvency and Bankruptcy Code, 2016.  

The growth of M&A culture was further enhanced by various reforms introduced by the authorities. Such reforms included [1]–  

i. New framework prescribed by SEBI on the aspect of issuance of Shares with Differential Voting Rights, which enables organisations and its members to receive investment without losing any control.

ii. Tax incentives and exemptions were granted to all registered start-ups, which increases M&As in the start-up sector. 

iii. Reform of Corporate Income Tax rates reduction has made India to be high in investment all over the world. 

Global Mergers and Acquisitions Trends

Global M&A culture has hit high in 2021 giving high hopes and promises for this year as according to the recent edition of the PwC’s global CEO Survey statistics clearly shows that 77% of CEOs expect global economic growth to improve during the year ahead. Furthermore, more than half of CEOs confidently showcased revenue growth in their own companies over the next 12 months, in which CEOs of private equity (67%) and technology companies (64%)  are two sectors which saw the highest M&A volumes and values in 2021.

The number of announced deals breaks records  exceeding  62,000 globally in 2021 from an  unprecedented 24% in 2020.By all records, the points that contributed to the record M&A market in 2021 will remain influential for deal-making in 2022 as well, whereby valuations are also expected to be high this year.In addition, global cross-border activity grew by 68% to $2.1 trillion, with U.S. outbound activity having a share for about one-third of the value of cross-border transactions.

India’s mergers and acquisition trends in 2021 

According to a recent report by Bain & Company titled “India M&A: Acquiring to Transform”, stated that India had an all time high Merger & Acquisition activity in 2021 with the  finalisation of 85 strategic deals valued over US$75 million,  in which  first-time buyers accounted for 80 percent of the volume.

Despite it, the disruption caused due to the pandemic Covid-19 followed by Omicron led  the rising of Acquisition market in India whereby companies have been opting for the acquisition route to secure higher rates of growth. As per data by financial market tracker Refinitiv, M&As’ in India , staked a three-year high after deals worth US$90.4 billion were struck in the first nine months of 2021. It also revealed that the average deal value stood at US$105 million till September 2021. It is proud to note that India added over 55 unicorns in the past two years alone and emerged as a hotspot for startups .Major sectors that have incentivised the  acquisition activity include renewable energy, electric vehicles, consumer durables, EdTech, and Fintech. 

If we talk about the Online food delivery major Zomato,  which acquired Uber’s food delivery business, ‘Uber-Eats’ for a deal value of around USD 350 million in 2020 was one of the major deals of that year . In this deal, Uber acquired 9.99% ownership in Zomato to transfer the entire Uber Eats’ business.

Top M&A deals in India in 2021

i. EdTech insurgent BYJU’s has made over 11 acquisitions valued at over US$2 billion, out of which approximately $US1 billion went towards acquiring Aakash Educational Services, an offline test prep company, building an omnichannel learning offering for its test-prep vertical for students enabling a vast learning pool .

ii. Piramal Group completed the acquisition of Dewan Housing and Finance Limited (DHFL) for US$4.7 billion, including a cash component and non-convertible debentures. 

iii. The acquisition of Indian payments giant BillDesk by technology investors Prosus NV was the largest merger and acquisition deal in the Indian fintech industry. Although, Prosus has its own Fintech business PayU, yet this acquisition will help PayU to become one of the leading online payments providers, globally, with presence in over 20 markets and increased total payments volume (TPV) of over US$4 billion.

PharmEasy has become the first Indian start-up to acquire a publicly listed company Thyrocare, which runs a chain of diagnostic and preventive care laboratories, enabling PharmEasy to build an end-to-end healthcare platform (D2C) from a customer’s point of view.

Both Sony Pictures Entertainment and Zee Entertainment Enterprises have entered into an exclusive, non-binding term sheet,to combine their linear networks, digital assets, production operations, and program libraries. The merged company would become a publicly listed company in India with Sony Pictures Entertainment holding the majority stake.

SEBI recently has intervened in the matter of preferential allotment of shares of PNB Housing Finance Limited (PNB Housing) adjudicating that it had failed to uphold the interest of minority shareholders, and directed the company to not issue a preferential allotment of its shares until the independent valuation of shares is complete.[2] On appeal, SAT rendered a split verdict, due to which an interim order allows PNB Housing to seek shareholder approval for the deal at an extraordinary general meeting but as condition mandates that the results be kept sealed,  continuing until further orders.[3]

In the acquisition of the Future Group retail, wholesale, logistics and warehousing business by Reliance Industries, there was a dispute by Amazon NV Investment Holdings LLC (Amazon)(which was an existing shareholder of Future Group), in which the Supreme Court, vide its order dated 6 August 2021,[4] inter alia held that the interim award delivered by an emergency arbitrator under the Arbitration Rules of the Singapore International Arbitration Centre, which was in favour of Amazon, was enforceable under Indian law, thus effectively stalling the deal.

In 2017, the Supreme Court, in Energy Watchdog v. Central Electricity Regulatory Commission & Ors[5], laid down guidelines on the availability of the force majeure exception, helping the courts in determining issues in the wake of Covid -19 pandemic :

I. force majeure would apply only to events that are beyond the reasonable control of the parties;

II. the party claiming relief would have to show whether best efforts have been taken to mitigate force majeure events;

III. an event shall be considered force majeure only if it was unforeseeable by the parties; and the event has rendered the performance impossible or illegal.

In Standard Retail Pvt Ltd v. GS Global Corp[6], the Bombay High Court refused to grant an injunction on the ground, inter alia, that there existed no direct link between the covid-19 pandemic and the non-performance of a contract , thereby contending that covid-19 pandemic cannot be used as an excuse to resile from a contract.


All the measures taken by the government together with the multiplication of M&A deals over the past two years has led to the globalisation of economic trade . A common factor which could be noted in all these deal makers is the persistent need to become more dominant in the market , despite being in the same .These companies have significant shares of their consumer market to manipulate and extend it with major acquisitions and mergers and further hamper the competition. Overall, it would be optimistic to opine that in the year ahead deals would show rapid upsurge in volume and valuations continuing to reflect a dynamic market and an abundance of capital. On the one hand, with newer technological adaptation, consistent pressure is created across all industries, while competition for targets is assumed to be strong. Companies will also seek to maintain competitive advantage and reinvest using divestitures of non-performing businesses across global markets.


[2] PNB Housing Finance Limited v. SEBI, 2021 SCC OnLine SAT 157.

[3]SAT order in PNB Housing Finance Ltd v. SEBI, dated 9 August 2021

[4] Amazon NV Investment Holdings LLC v. Future Retail Limited, 2021 SCC OnLine SC 557.

[5] Energy Watchdog v. Central Electricity Regulatory Commission & Ors, (2017) 14 SCC 80

[6] 2020 SCC OnLine Bom 704.

Published by meghachaturvedi

Associate Partner, H.K. Law Offices

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