India Inc turns its eyes toward UK |
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Published
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Mon, 30 Oct 2006 13:25
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LONDON - Tata steel's acquisition of Corus for £4.3 billion earlier this month has highlighted the fact that big corporations in India are looking to greener pastures like the UK to make more deals than ever before. They are being helped by a relatively open regime as well as the booming Indian economy.
As of October this year, Indian firms have acquired 130 businesses thought to exceed $18 billion (£9.5 billion) in value. The most famous of them being the bitter takeover of Arcelor by Mittal Steel. India has also become the third-largest investor in the UK this year pumping in $2 billion in this year to to March 2006.
Financial Express, a leading Indian newspaper quoted an investment banker as saying that the increased activity in the investment market suggests that investments were flowing from both domestic as well as foreign avenues.
"This is also a sign of greater consolidation and value creation for the shareholders of the companies whose shares are being acquired in the process," he added.
India's booming economy is growing at a pace of 9.3 percent and 8.9 percent over the last couple of years. This has helped firms like Ranbaxy Laboratories to acquire RPG Aventis to have a major say in the generic drug market in Europe.
Also Mahindra & Mahindra, the automobile group has acquired Stokes, a British-based automotive forging company, while Suzlon has acquired Belgian group Hansen Transmissions. These are but a handful of the top deals sealed by Indian firms.
The growing clout of Indian corporations in the world markets, especially in the UK, has not gone unnoticed. Gone are the days when Indian companies made up the numbers on the world stage. These days they are engaged in making numbers talk. And that can be put into perspective by the Tata-Corus deal, since the former is much smaller entity than the latter.
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Britain faces dearth of IT professionals, 22,000 work permits issued in a year 