JANUARY 2014

Press Review – January 2014

EURO-ASIA M&A TRENDS

In 2014, a combination of factors will enable an active M&A market:

  • Favorable credit markets and lending environment
  • Low interest rates
  • Increased corporate cash and finite-lived private equity capital reserves
  • Large inventory of companies owned by private equity firms (nearly 18,000 according to the Private Equity Growth Capital Council) that may seek liquidity given strong prevailing market conditions
  • Healthy stock market performance – the S&P 500 was up nearly 30% in 2013 – which may push companies to demonstrate sustained growth through M&A to validate share prices
  • Recent uptick in cross-border M&A activity


In China, while a number of billion-dollar plus overseas penetration deals have been secured by Chinese State Owned Enterprises (SOEs) in the energy and natural resource sectors, China’s industrial SOEs have been more cautious with SOEs requiring to get numerous approvals from Chinese regulators to invest outside of the country despite the government’s encouragement to venture into global markets.

In India, approximately 500 M&A deals were publically announced in 2013, which amounted to USD 28.2 Bn in transactions. Despite a fall in the total value of deals (-20% YoY), interests in India remain resilient particularly in the Pharmaceutical & Aviation Industry as the commercial & regulatory environments play strongly in their favor.

Overall, there are positive signs for M&A activity in 2014 as compared to 2013. The availability of low interest rate debt, strong advances from private equity companies as well as owners looking to sell their high-quality businesses will help contribute to M&A activities.

FOOD & BEVERAGE

Beverage

RABO EQUITY ADVISORS (India) to buy stake in KWALITY DAIRY (India)

Delhi based dairy foods company KWALITY DAIRY INDIA LIMITED is in talks to divest 14-15% stake to PE firm RABO EQUITY ADVISORS for about USD 81.2 M to expand its footprint globally.

Revenue: USD 6.9 Bn (2013)
Revenue: USD 627 M (2013)
EBITDA Margin: 5.6%
EV/EBITDA: 7.1x

January 21st / DealCurry

ALLIED BLENDERS (India) may acquire TILAKNAGAR INDUSTRIES (India)

ALLIED BLENDERS is in talks with PE majors CARLYLE and TPG to raise USD 200 M for acquiring majority stake in TILAKNAGAR INDUSTRIES. The acquisition move will give ALLIED BLENDERS a strong foothold in the brandy market and a good presence in the southern part of the country which is considered as the biggest market for brandy in India.

Revenue: USD 6.9 Bn (2013)
Revenue: USD 120 M (2013)
EBITDA Margin: 23%
EV/EBITDA: 4.8x

January 22nd / Reuters & Business Standard


Food

WILMAR INTERNATIONAL (Singapore) buys 25% stake in SHREE RENUKA SUGARS (India) for USD 100M

Singapore-headquartered agribusiness major WILMAR INTERNATIONAL LIMITED is in the final stage of negotiations to buy up to 25 per cent stake in India’s largest sugar manufacturer SHREE RENUKA SUGARS for USD 100 M.

Revenue: USD 39 M (LTM from Sep 2013)
EV/Revenue: 0.9x
EV/EBITDA: 7.5x

January 15th / Vccirle

SIR SHADILAL (India) to sell Sugar Unit to SUPERIOR FOODS (India)

Sugar manufacturer SIR SHADILAL ENTERPRISE is selling its sugar mill in Uttar Pradesh to Chandigarh based SUPERIOR FOOD GRAINS. The deal is expected to be concluded by the end of this fiscal year involves a slump sale of all assets & liabilities Unn Sugar Mill to the buyer.

January 16th / DealCurry & Silo Breaker

HEALTH & BEAUTY

Pharmaceuticals

TEMASEK HOLDINGS (Singapore) to acquire minority stake in INTAS PHARMA (India)

Singapore based TEMASEK HOLDINGS is in talks to acquire a minority stake in INTAS PHARMACEUTICALS for USD150-180 M giving partial exit to its existing investor CHRYSCAPITAL.

Revenue: USD 568 M (2013 Mar LTM)

January 20th / Deal Curry

AUROBINDO PHARMA (India) to acquire business units of ACTAVIS (Europe)

AUROBINDO PHARMA, a major player in the pharmaceutical industry of India has been looking at domestic & overseas acquisitions to increase its scale & revenues. It plans to acquire the API units of Dublin headquarted, ACTAVIS.

Revenue: USD 7.6 Bn (2013 Sep LTM)
EV/Revenue: 5.1x

January 14th / Reuters & Bloomberg


Cosmetics & Toiletries

L’OREAL (France) gets approval for MAGIC HOLDINGS (China) acquisition

L’OREAL has been given the go-ahead by the Ministry of Commerce of the People’s Republic of China to proceed with its acquisition of MAGIC HOLDINGS INTERNATIONAL for approximately EUR 620 M. The deal is expected to close in the second quarter of 2014.

Revenue: EUR 160 M (2013 June LTM)
EV/Revenue: 3.3x
EV/EBITDA: 21.7x

January 13th / 4-Traders & The Moodie Report


Fashion

VERTEX VENTURE (Singapore) invests USD 15 M in FIRSTCRY (India)

FIRSTCRY, an online portal for baby products is raising USD15 M from Singaporean sovereign fund VERTEX VENTURE HOLDING with a move to emphasize more on its offline presence and build more on its hybrid business model.

Revenue: USD 568 M (2013 Mar LTM)

January 20th / Deal Curry

INDUSTRY & CLEANTECH

Renewable Energy

NEWQUEST (HK) acquires CHINA HYDROELECTRIC (China) for USD 190 M

Hong Kong-based NEWQUEST will acquire CHINA HYDROELECTRIC for USD 190 M. The price is 18.2% higher than when NEWQUEST made a preliminary non-binding proposal in September 2013. NEWQUEST currently owns 49.8% ordinary shares of CHINA HYDROELECTRIC.
Revenue: USD 77 M

January 15th / China Money Network

NEW TECHNOLOGIES

Software

Cloud Telephony Startup KNOWLARITY (India) acquires UNICOM TECHLABS (India)

Sequoia backed cloud telephony startup KNOWLARITY COMMUNICATIONS has acquired its peer UNICOM TECHLABS for an undisclosed amount. The acquisition provides the company with over 200 customers from varied industries & segments.

EV/Revenue: ~10x

January 13th / DealCurry


Social Media

FACEBOOK (US) to buy LITTLE EYE LABS (India)

FACEBOOK INC. is buying India-based LITTLE EYE LABS, a startup that builds performance analysis and monitoring tools for mobile Android apps. The terms of the deal were not disclosed, but media reports suggest the price was less than USD 15 M.

January 9th / Reuters


E-Commerce

UNILAZER VENTURES (India) acquires stake in online grocer EKSTOP (India)

UNILAZER VENTURES has picked up a 25% stake in e-grocery retailer, EKSTOP SHOP PVT LTD for an undisclosed amount. The Mumbai based company will use the funds to upgrade its technology, hire key employees and increase its customer base.

January 7th / DealCurry

DEALDOZEN (Philippines) has been acquired & will be rebranded as StreetDeal in 2014

Philippines daily deals site DEALDOZEN has been acquired by ASIA DEAL GROUP for an undisclosed amount. Following its already established presence in other Southeast Asian countries, the acquisition allows the company to expand to the Philippines where it saw a growing online population with a good payment card penetration.

January 6th / Tech in Asia