Corporate India lost $27-bn merger deals this year so far

According to the data compiled by research firm VCC Edge, as many as nine deals have been called off this far in 2010. "The failure of the mega deals was primarily due to valuation concern. Management control issues and strategic unsuitability of the deals was another reason for cancellations", SMC Capitals Equity Head Jagannathan Thunuguntla said.

The country's most valued firm RIL's bid to acquire a majority stake in bankrupt petrochemical group was called off by LyondellBasell after the latter found the price offer was undervaluing the company.

The transaction could have been the largest buyout ever made by an Indian firm overseas. So far, Tata Steel's acquisition of Anglo Dutch steel producer Corus Group in 2007 for USD 12 billion, is the biggest deal in the Indian corporate history.

Besides, the most recent cancellation was of RCom's arm Reliance Infratel's USD 10.8 billion tower merger deal wih GTL Infrastructure. Interestingly, the Ambani brothers, who have been most active in merger and acquisition activity this year, accounted for over USD 25 billion of the deals in 2010 that could not take off in 2010.

Mukesh Ambani led RIL, last month, had made foray in the hospitality sector by picking up a 14.18 stake in EIH Ltd, promoted by Oberoi group of hotels and resorts. This was his seventh acquisition in the current year.

Early in the year, EIH also witnessed a deal cancellation of USD 272 million in which Max Hospital's founder and chairman Analjit Singh was interested in 17 per cent stake in the hospitality major.

Other than the Ambani brothers, another significant deal that did not work was Singapore's GIC Special Investments' USD 84.7 million bid for 6.58 per cent stake in the billionaire brothers Malvinder Singh and Shivinder Singh led Fortis Healthcare.

Naveen Jindal led Jindal Steel and Power (JSPL) was also denied a stake in Zimbabwe Iron & Steel, estimated to be in the range of USD 600 million- USD 1 billion by the government, as it did not approve of selling the ailing company to large corporates.

Rest of the transactions that turned sour so far this year include---US based Scripps Networks Interactive attempt to buy stake in NDTV Lifestyle, drug major Abott Laboratories' interest in Wockhardt, multiplex chain PVR Cinemas' bid for DT Cinemas and Ingersoll Rand USA's attempt to merge the Indian subsidiary into itself.

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