M&A deals in India

Hello everyone,
I have a few questions on the M&A market in India

-As there have been 1000s of startups coming out of India every year I believe there should be lot of M&As going on

my questions are as follows:

  1. is the system efficient?
  2. do the banks charge exorbitant fees to complete the deals?
  3. are the potential buyers and sellers getting matched accordingly?
  4. how long does it take to complete a deal in India?

Thanks a lot for your time and answers, any advice/insights will be held in high regard
@nithin
@Pai
@zerodha

Hi Skanda,

M&A space in India is quite complex - while I am not an expert here are some views.

  1. Efficiency of M&A market: The efficiency of the M&A system in India can be difficult to judge. We’ll need to look at regulations, market conditions, and the complexity of deals. Apart from that we’ll need to analyze deal volume and value over time, speed of deal execution, transaction costs, access to financing etc. But generally speaking in this space, there is more to do in terms of efficiency of course.

  2. Bank Fees: Investment Banks and Big 4s and other firms involved in M&A transactions typically charge 2-5% based on the deals. The fees can vary based on the size and complexity of the deal, as well as the services provided. Since there are quite a few IBs in the market today, dont think there can be excessive fees being charged.

  3. Matching Buyers and Sellers: Here again, professional intermediaries such as investment banks and advisory firms (Big 4s) play a key role in facilitating these matches.

  4. Deal Completion Time: The time taken to complete an M&A deal in India can vary widely depending on the complexity of the transaction, regulatory approvals required, and the negotiation process. Some deals can be completed relatively quickly, while others may take several months or even longer to finalize.

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thanks a lot for your answer Mr pai
do you believe that there is an opportunity to solve a problem in this sector?

Depends on the differentiation you will bring to the table. There are obviously tons of IBs and firms looking to work on M&A, but if you have a pain point narrowed down that can be solved for, there could be an opportunity.

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This was definitely from bard or GPT

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Missed adding disclaimer in the response that I used chatgpt to structure it. :slight_smile: My bad.

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