Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
Popular Search: empanelment :: cpt :: Central Excise rule to resale the machines to a new company :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT Audit :: TAX RATES - GOODS TAXABLE @ 4% :: ACCOUNTING STANDARD :: TDS :: VAT RATES :: form 3cd :: list of goods taxed at 4% :: ACCOUNTING STANDARDS :: articles on VAT and GST in India :: due date for vat payment :: ARTICLES ON INPUT TAX CREDIT IN VAT
Mergers and Acquisitions »
 Tata Teleservices could be acquired by Airtel as India heads towards four-operator market
 Deals of the day-Mergers and acquisitions june 28, 2017
 Why is Avendus Capital behind most large e-commerce deals in India?
 India one of most attractive merger and acquisitions destinations in Asia.
 Deals of the day-Mergers and acquisitions june 20, 2017
 How new funding avenues, M&As are powering India’s renewable energy sector
 Finance Ministry asks PSBs to explore acquisition of smaller banks
 Bank of Baroda, Canara Bank may lead next round of mergers
  Deals of the day-Mergers and acquisitions June 13, 2017
 India’s booming stock market has a downside: It’s making M&As expensive, says BNP Paribas
 Cross border mergers make India favoured FDI route: UNCTAD

Improve merger and acquisition activity
May, 10th 2010

PricewaterhouseCoopers says that after a lull in mega metals deal activity last year, two mega deals fueled by a quest for iron ore by Chinese companies were announced during the during the first quarter of this year.

PwC noted in its report forging ahead both of these deals involve iron ore, as well as Chinese acquirers, first quarter 2010 global metals industry mergers and acquisitions analysis.

The largest deal announced in the first quarter was Chinalco USD 1.35 billion minority stake transaction in Rio Tinto Simandou iron ore joint venture. In their analysis, PwC analysts noted "This deal is also characteristic of the rise in the use of joint ventures as an acquisition technique."

The analysts said "Although the proportion of minority stakes is not likely to rise significantly through the balance of 2010, joint ventures should continue to contribute substantially to deal totals. This is due to an interest in mining assets reviving as commodity prices recover, as well as companies needed to bring in financially strong parties to help develop attractive mining projects."

The second mega deal announced in the first quarter is the USD 1.22 billion East China Mineral Exploration & Development Bureau acquisition of Brazilian iron ore miner Itaminas Comercio de Minerios which is estimated to have 1.3 billion tonnes of iron ore reserves.

PwC predicts that, in the next six to 12 months, the metals industry will likely turn its attention to mergers and acquisitions, depending on how cautious lenders will affect metals companies' ability to finance future deals.

Signs of recovery already appeared in the metals sector during the first quarter of this year as 21 deals were announced with a total combined value of USD 5.9 billion.

PwC also suggests that the increased use of stock swaps in deals may be related to improved equity market performance, which makes the financing of acquisitions through stock more attractive.

Though it is difficult to predict the relative use of this form of acquisition going forward, divestitures are likely to continue to be favored as a source of deals as sector constituents seek to improve their balance sheets and realign their asset portfolios.

PwC's analysis also forecasts that, in the future "Chinese outbound deals should drive total acquisitions among emerging and developing economies as well as total cross border deals, the latter of which increased slightly on a relative basis during the first quarter. It is also likely that Chinese local market acquisitions will contribute significantly to deal totals as the central and state governments advocate for some of these transactions."

Mr Robert W McCutcheon the US metals leader for PwC said "This continuation of mega deal activity provides evidence that some acquirers are ready to engage in deal making at the higher end of the value spectrum. Supporting this are higher commodity prices, improved access to capital, and greater confidence in the strength of the recovery."

He said that "Looking forward into 2010, the sector's M&A flow will likely continue to grow."

Mr Jim Forbes PwC Global Metals Leader noted that "Globally the relative sense of urgency to engage in new deals is likely greatest for steel companies, which face a consolidated basis of iron ore suppliers. This could lead to additional horizontal mergers among steel constituents or backward integration."

He said that "Although many strategic buyers have been slow to resume their M&A activities, we believe it is only a matter of time before these acquirers look more seriously at potential growth opportunities. A more stable global economy, generally supportive capital markets and improved financial positions should encourage these entities to enter the deal market."

Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Integrated Software Solutions Integrated Software Development Integrated Software Services Integrated Software Solutions India Integrated Softw

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions