The airline industry has seen two acquisitions in recent months. Few realize that such purely domestic deals—where one Indian company buys another— have been very rare this year, despite all the buzz about consolidation. Our search of the Bloomberg database shows just one other big M&A deal involving two Indian companies in 2007, when Mahindra & Mahindra acquired Punjab Tractors. But even here, the seller was Actis, a global private equity firm.
The biggest M&A deals of the year have been cross-border ones. First, there have been those where local companies have taken over global competitors. Second, there have been the mirror-image deals where global majors have bought into firms in India.
This is intriguing: Indian companies are buying and selling assets across borders, but are shy of doing the same within India. Why?