M&A activity in India has reached USD 46.5 billion in 2017 and is predicted to hit USD 52.8 billion in 2019. There are many reasons for this spike, and one important reason is consolidation among domestic players. The potential opportunities driving consolidation among domestic players are as follows:
- Expansion of customer base
Post the proposed Vodafone-Idea merger, the combined subscriber count of the merged entity is expected to be around 39 crores with 35% of the market share, making the combined entity the largest operator in India and the second largest in the world. Its nearest competitor, Bharti Airtel, currently has 24.21% of the market share.
The acquisition of BSS Microfinance by Kotak Mahindra Bank led to Kotak’s entry into the micro-lending sector and provided it access to approximately 271,000 customers of BSS.
In the pharma sector, the recent acquisition of Strides Shasuns’ drug brands in India by Eris Lifescience will enable Eris to break into the league of top 25 companies that have a market share of more than 1% in the pharmaceutical sector.