Mergers and acquisitions: India M&A deals seen at $52.1 billion in 2019

With mergers and acquisitions (M&A) reaching $52.1 billion, India dealmaking activity is expected to revert to the "normal" in 2019 despite global slowdown, according to a report by law firm Baker McKenzie on Tuesday.

"India M&A shows resilience amidst the current global economic turmoil. While domestic consolidation will continue to be a key driver in the M&A activity, India's business-friendly reforms and high consumption growth potential will help garner interest from both local and foreign investors," Ashok Lalwani, Global Head of Baker McKenzie's India Practice, said in a statement.

Highly notable was Canada's Brookfield Infrastructure Partners' $3.66 billion investment to acquire Reliance Industries' Reliance Jio lnfratel unit. Announced in July, the acquisition was touted as the single biggest private equity deal in India.

Despite the global headwinds, India M&A was expected to remain stable in the next few years with private investments reviving against the backdrop of a more favourable business environment, said the report.

India's gross domestic product (GDP) is expected to grow around 7 per cent through 2019-2022, ahead of the global GDP growth rate of 2.8 per cent for the same period.

In initial public offerings (IPOs), total proceeds (predominantly from domestic IPOs) is likely to decline from $3.4 billion in 2019 to $2.7 billion in 2020, before picking up in 2021 to $4.3 billion.

"We are hopeful that India will remain one of the world's fastest growing economies despite the headwinds," Lalwani said.

Global deal making will continue to slow down in 2020 because of ongoing worldwide economic uncertainty and the risk of global recession, said the report.

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M&A would decline globally from $2.8 trillion in 2019 to $2.1 trillion in 2020, said the firm's fifth annual "Global Transactions Forecast", jointly released with Oxford Economics.

It also predicts a downward trend in global IPO proceeds from an estimated $152 billion in 2019 to $116 billion, a 23 per cent drop.