Crisil to buy UK-based analytics firm
Crisil to buy UK-based analytics firm
Mumbai: Rating company Crisil Ltd has agreed to acquire UK-based analytics firm Coalition Development Ltd , along with its subsidiaries, for about £29 million (Rs 250 crore).
This is the 20th merger and acquisition (M&A) deal by an Indian firm in Europe so far this year. According to estimates by VCCEdge, which tracks investment activity in the country, the 19 outbound deals struck so far were worth $786.2 million (around ₹ 4,395 crore).
The deal is an all-cash transaction and will add to the earnings per share (EPS) of Crisil from the first year. The transaction is subject to regulatory approvals, a Crisil statement said on Friday. “After the deal, Coalition will be part of Crisil’s global research and analytics business,” said Roopa Kudva, managing director and chief executive of Crisil.
Coalition’s analytical capabilities, understanding of the workings of financial markets and clients “will enable Crisil’s global research and analytics to widen service offerings, diversify its client base and deepen client relationships,” Kudva said.
Coalition Development, which provides high-end analytics mainly to leading global investment banks, reported a 2011 revenue of £8 million. Crisil, which provides research and risk and policy advisory services apart from rating companies, is majority owned by global rating company Standard and Poor’s.
In 2010, Crisil had acquired US-based knowledge process outsourcing (KPO) firm Pipal Research Corp. from Firstsource Solutions for $12.75 million.Mape Advisory Group was the adviser to Crisil on the purchase of Coalition.
Experts say Indian purchases of European firms are rising as businesses are available at cheaper valuations, making it easier for cash-rich firms to bargain at a time when Europe is struggling with a sovereign debt crisis. These acquisitions give Indian companies access to new markets, innovative technologies and a mechanism to spread risk through geographical diversification.
The overseas acquisitions, however, tend to face integration issues, cautioned Sunil Goyal, managing director and chief executive, Ladderup Corporate Advisory Pvt. Ltd, an investment bank.
“Integration challenges can disrupt businesses. Indian companies need to reduce the integration timeframes which can even take two to three years,” he said. “The outbound deals are on a rise and will continue to be so.”
Harish H.V., partner, India leadership team, at accounting and advisory Grant Thornton India, said while Indian companies will be acquisitive in Europe, there would not be many large-ticket deals (above $1 billion). “These would mostly be sub-$300 million deals and the most preferred sectors would be pharma, auto components and technology,” he said.
Last year saw 644 India-related M&A deals worth $44.61 billion, including 142 inbound deals in which foreign firms acquired businesses in India worth $28.73 billion. In 146 outbound transactions, Indian firms bought businesses abroad in deals worth $10.84 billion, according to Grant Thornton India’s estimates.
deepti.c@livemint.com
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Business NewsCompaniesCrisil to buy UK-based analytics firm
First Published:1 Jun 2012, 11:14 PM IST
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