Mergers and acquisitions hit record level in 2022: Zee Business analyst decodes sectors that saw most action

India Inc witnessed record merger and acquisition (M&A) deals this year as sectors like Banking, Cement and Aviation saw maximum traction, a Zee Business Research Analyst Nupur Jainkunia explained in her research report, while giving the outlook for 2023.  

2022 attracted more than Rs 12.5 lakh crore through M&A deals as compared to Rs 9 lakh crore in 2021, Rs 5 lakh crore in 2019 and Rs 8 lakh crore in 2018, Jainkunia said. She added that deals between HDFC-HDFC Bank, Adani Group-ACC and Ambuja Cement and Air India-Vistara were among the highest. 

HDFC – HDFC Bank Merger 

On April 4, India's largest private lender HDFC Bank agreed to take over the biggest domestic mortgage lender in a deal valued at about USD 40 billion, creating a financial services titan.  

Following the merger, the combined balance sheet will be Rs 17.87 lakh crore and the net worth will be Rs 3.3 lakh crore, as of December 2021 balance sheet. 

Adani Group – ACC & Ambuja Cement 

On May 15, the Adani Group announced a deal to acquire a controlling stake in Swiss building material major Holcim Ltd's businesses in India for $10.5 billion (about ₹83,920 crore current value), marking the ports-to-energy conglomerate's entry into the cement sector. 

Adani Group will acquire 63.1 per cent of Ambuja Cements along with related assets. Ambuja's local subsidiaries include ACC, which is also publicly traded. 

Tata Group: Air India – Vistara Merger

The Tata group announced the merger of Vistara with Air India on November 29, marking a major consolidation in India's fast-growing aviation space. The deal will make Air India the country's largest international carrier and second-largest domestic carrier. 

According to Jainkunia, the total value of this deal comes around Rs 74,000 crore, making it the third biggest merger announcement this year from aviation space. 

Besides, telecom major Bharti Airtel and search engine giant Google Inc also made a bound deal worth Rs 5,800 crore. And Jaiprakash Associates Ltd announced the sale of remaining cement assets to Dalmia Bharat Ltd at an enterprise value of Rs 5,666 crore earlier on December 12. 

M&A Outlook 2023 

The research analyst believes consolidation in metal, casting, forging, textile and agro-procession, commodity and chemical are possible next year. Similarly, companies may divest their non-core business assets to improve balance sheet in 2023.