INDIA Law and Practice Contributed by: Anand Lakra, Shivpriya Nanda, Zain Pandit and Ami Shah, JSA Advocates & Solicitors
billion, a 41% year-on-year growth. Real estate followed closely, with USD8.8 billion. Among other traditionally PE/VC friendly sectors, tech - nology saw a remarkable 56% growth, reach - ing USD6 billion, while e-commerce galloped to 87%, totalling USD4.6 billion. However, the life sciences sector experienced a 31% decline, with investments falling from USD6.2 billion in 2023 to USD4.3 billion in 2024 (Source: EY) Outbound M&A Activity Driven by strong balance sheets and capital availability among legacy and new-age com - panies, outbound M&A activity made 2024 a milestone year for Indian corporate investments overseas. During the last quarter of 2024, out - bound deals marked a ten-year high in terms of volume, with 35 M&A transactions worth USD5.3 billion, according to Grant Thornton’s Dealtracker report. By the end of 2024, Indian companies had completed more than 100 M&A transactions, with the USA and Europe seeing the bulk of the activity. Deal activity appears to be broad-based and led by mid-market firms. However, Bharti Airtel’s acquisition of a 24.5% stake in BT Group for USD4.08 billion and Oyo’s acquisition of the budget motel chain Motel 6 for USD525 million are indicative of the ambitions of both legacy and new-age business. 1.3 Key Industries India’s IT and IT-enabled services sector leads the M&A landscape, accounting for 21.0% of all acquisitions. India’s rapid digital transforma - tion and the increasing demand for technology driven solutions is a significant driver of growth. Fintech and financial services represents 9.3% of M&A activity, with e-commerce a close third at 8.7%. Increased digital payments, mobile commerce and tech-enabled financial services are change-agents for these sectors. PE firms,
in particular, are focusing on high-growth tech companies with strong expansion potential. Energy and natural resources (8.6%) and health - care/life sciences (7.8%) also saw substantial M&A activity. Both sectors are poised for long- term growth, aligning with global trends toward clean energy solutions and advancements in biopharma. Foreign investment into Indian generative AI start-ups continues to gather steam. AI start-up Krutrim and fintech firm Perfios became India’s first AI start-ups to attain unicorn status in 2024. Investment in the sector was further bolstered by the government of India’s USD1.24 billion fund - ing package to launch its IndiaAI Mission and USD10 billion semiconductor scheme. 2. Overview of Regulatory Field 2.1 Acquiring a Company Usually, acquisitions are consummated by pur - chase of existing shares or issuance of new shares to the acquirer. Consideration for such acquisitions may be cash or non-cash, with stock swap being one of the common modes for discharging non-cash consideration. Alternatively, where an investor proposes to acquire only a division or business unit of the target, transfer of assets or undertaking (also known as a slump sale) of the business is also adopted. Lastly, in certain cases, the National Company Law Tribunal approved mergers which are implemented for acquisition, however, such tribunal mergers take much longer to complete than share acquisitions.
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