The rapidly evolving market conditions are putting immense pressure on companies to maintain structural profits and revenues. To survive and have an upper hand in the market compared to competitive firms, businesses are reimagining their future by opting for Mergers & Acquisitions (M&A) strategies with a motive to recover, learn and expand.
M&A strategies are considered an amalgamation of both defensive and offensive moves played by the company with the aim of building accelerating business models.
Defensive Move
One lesson that is a must for all companies is to build a business model with a firm establishment of resilience at its core. The defensive move through M&A strategy helps businesses ensure their agility & adaptability and ward off threats from competitors in the marketplace.
Offensive Move
In the words of George Washington, the first US President, “The best defence is a good offence.” This stands true in the business world also. As important as it is to defend businesses from possible threats in the marketplace, it is equally important to make bold moves. The acquisition allows the company to play the smart and bold move to capture the market and enjoy the competitive advantage from the leadership position.
Businesses are now understanding the value of offensive and defensive moves and the remarkable shift has been noted in the M&A in the post-pandemic era.
Mergers & Acquisitions in 2023
India is acing the game by hitting record highs in the last few years. India has witnessed some major mergers and acquisitions in 2023.
Adani Group and IANS Media
December 2023
Deal Worth: Undisclosed
Billionaire Gautam Adani’s Group acquired a majority stake in the news agency IANS India Pvt Ltd for an undisclosed sum as the group expands its presence in the media space. Adani Group’s subsidiary, AMG Media Networks Ltd acquired a 50.5 per cent stake constituting equity shares of IANS India Pvt Ltd.
Adani forayed into the media business in March 2023 when it acquired 49% of Quintillion Business Media, which operates the business and financial news digital media platform BQ Prime. In December, the Adani Group acquired a 65 per cent stake in the news broadcaster NDTV.
Reliance Retail Ventures and Ed-a-Mamma
September 2023
Deal Worth: Undisclosed
Reliance Retail Ventures Ltd (RRVL) announced a partnership with Ed-a-Mamma, the eco-conscious clothing brand founded by Bollywood actress Alia Bhatt. With this partnership, Ed-a-Mamma sets to explore fresh domains, including personal care and baby furniture. Moreover, it will continue to create more child-friendly, parent-friendly, and environmentally conscious products.
Isha Ambani, Director, Reliance Retail Ventures Ltd, said Ed-a-Mamma’s dedication to sustainability, ethically sourced materials, and eco-conscious production processes align perfectly with Reliance Brands’ vision of a more responsible future for the fashion industry. This partnership also marks a significant step in promoting sustainable fashion for the younger generation. Additionally, the company plans to create children’s storybooks and an animated series shortly.
Saregama and Pocket Aces Pictures
September 2023
Deal Worth: ₹174 crore
Music label Saregama, under RP- Sanjiv Goenka Group, acquired a stake of 51.8% in digital entertainment company Pocket Aces Pictures Pvt Ltd for 174 crores in an all-cash deal. The company said that it would further acquire another 41% stake in the next 15 months at pre-agreed multiples.
Avarna Jain, Vice Chairperson, Saregama in a statement said, “This acquisition signifies the confluence of tradition and innovation. While we have always been leaders in the realm of music and media, this partnership with Pocket Aces will add new dimensions to our business as we tap into the burgeoning young digital audiences.”
Car Trade Tech and Sobek Auto India
July 2023
Deal Worth: ₹537 crore
Car Trade Tech has entered into a share purchase agreement with Sobek Auto India Private Limited and OLX India BV, acquiring a 100 per cent stake in Sobek for Rs. 537.43 crores in July 2023. Sobek is engaged in the business of running an automotive digital platform and a classified internet business from OLX India Private Limited under a business transfer agreement. As a part of the acquisition, Sobek has now entered into an intellectual property license agreement and a transitional support agreement for the use of certain brands and technology.
“The acquisition is in furtherance of the strategic objectives of the company to undertake investments which provide synergistic benefits to the existing businesses of the CarTrade Tech,” the company said, in the stock exchange filing.
National Investment and Infrastructure Fund and Hindustan Ports
February 2023
In February 2023, The Competition Commission of India (CCI) approved the acquisition of up to 25 per cent stake in Hindustan Ports Pvt Ltd (HPPL) by the National Investment and Infrastructure Fund (NIIF). The regulator also approved the merger of Hindustan Infralog Pvt Ltd into HPPL.
Hindustan Ports Private Limited (HPPL), Hindustan Infralog Private Limited (HIPL) and their Subsidiaries are together referred to as Target Entities. The Target Entities are engaged in providing container terminal services at different ports in India; operating container freight stations, providing container rail operations, freight forwarding services, empty container handling, domestic rail operations, operating private freight terminals / inland container depots, express logistics, contract logistics and bulk handling services, cold chain logistics solutions and free trade warehousing related services.
PVR Pictures and Inox Leisure
February 2023
PVR Pictures, the leading cinema chain, merged with Inox Leisure and adopted a new identity, PVR INOX Pictures, in May 2023. It operates with 361 cinemas and 1,689 screens across 115 cities in India and Sri Lanka, holding a 43% share of multiplex screens in India.
“PVR INOX Pictures will aspire to be the most innovative, exciting and fun place to share your stories with India,” said Sanjeev Kumar Bijli, Executive Director, PVR INOX Limited. “With two large forces coming together, the scale of opportunities is unprecedented. PVR INOX Pictures will continue to serve as a partner to content producers across the globe and expand the quality and depth of content that is made available to Indian consumers.”
The Bottom Line
These mergers and acquisitions deals depict how businesses are changing to survive and grow in today’s fast-paced market. As big companies join forces, it’s not just about money; it’s about creating a new way of doing business that’s sustainable and innovative for the future.
